Revenue and Net Profit Increases by 25.8% and 21.7% Respectively
HONG KONG – (ACN Newswire) – Steve Leung Design Group Limited (“SLD Group” or the “Group”; HKEX stock code: 2262), an award-winning and internationally renowned interior design services and interior decorating and furnishing services provider headquartered in Hong Kong, today announced its first interim results, for the six months ended 30 June 2018 (“Period”), since its listing on the Main Board of The Stock Exchange of Hong Kong Limited (“SEHK”) on 5 July 2018.
During the Period, the Group recorded year-on-year revenue growth of 25.8% to HK$223.5 million and gross profit up by 19.3% year-on-year to HK$107.6 million. Such encouraging results were mainly driven by the prompt conversion of projects on hand to revenue, as well as the significant growth of the Group’s interior decorating and furnishing services business segment. Net profit for the Period amounted to HK$25.2 million, representing a year-on-year increase of 21.7%.
The Group’s satisfactory performance can be attributed to its ability to leverage its award-winning and internationally renowned interior design services to expand its business and clientele. While achieving both objectives, the Group placed particular focus on high-end residential, private residence and hospitality projects in the PRC, Hong Kong and overseas markets. The Group will also leverage its clientele to explore new business opportunities in the second and third tier cities in the PRC.
Apart from interior design projects, the Group continued to broaden its interior decorating and furnishing services business, resulting in steady business growth. Both the interior design and interior decorating and furnishing services businesses thus constitute key pillars of the Group.
Interior Design Services
The interior design services segment remained the primary business and main revenue source of the Group, accounting for over 82.7% of total revenue. Despite unfavourable market conditions, including a slowdown in the PRC real estate market, the interior design services business managed to perform at a similar level to last year. Furthermore, with the Group’s ability to appeal to its clients by adding value to their properties, including among the major property developers in the PRC, such widespread recognition has also contributed to the stable performance of the interior design services business.
Interior Decorating and Furnishing Services
The interior decorating and furnishing services business commenced operation in 2016, and has achieved notable growth during the past two years. During the Period, the segment accounted for approximately 16.1% of its total revenue, and achieved year-on-year top line growth of 98.7%. The noteworthy performance was attributable to a large number of contracts signed both prior to and during the Period, as well as clients choosing to employ the Group based on its ability to provide a comprehensive scope of services that includes both interior design and decorating and furnishing services.
Product Design Services
Another important facet of the Group’s operation is product design services, an area of activity resulting from its business and service diversification drive. During the Period, the segment continued to perform steadily, delivering satisfactory returns to the Group. Moving forward, the Group will continue to collaborate with internationally renowned brands for product designs including furniture, bathrooms, kitchens and home accessories, etc.
Looking ahead, the Group will maintain focus on developing its three principle business segments, which will involve diversifying their revenue sources, thus also minimise the impact of possible risk on the Group. Aside from focusing on residential and hospitality projects, the Group intends to place greater effort on developing specialised interior design and decorating services, particularly for the elderly, wellness, advanced technologies and environment-related sectors.
According to Frost & Sullivan report, the market size of specialised interior design and decorating services in the PRC will grow steadily at a CAGR of 8.2%; while in Hong Kong, driven by projects from the public sector initiated by the Urban Renewal Strategy as well as the growing need for infrastructure upgrades, the market will grow robustly at a CAGR of 7.8%. The Group is well-poised to capture these opportunities.
The Group will also implement a series of measures to ensure sufficient resources to support its day-to-day business operation. Such measures include expanding its interior design, interior decorating and furnishing, and product design teams, developing their specialisations, broadening and diversifying the furniture, fittings and accessories catalogue and enlarging headquarters and offices. In addition, greater resources will be allocated for maintaining and developing information technology systems. Also, efforts will be placed on devising and implementing marketing strategies, and participating in more industry-related exhibitions, forums and media programmes to enhance SLD Group’s brand equity.
As the interior design and decorating services markets are highly fragmented and competitive, the Group will also consider relevant M&As. Such transactions would not only create more business opportunities and accelerate the growth of the Group, but would also facilitate synergies with SLD Group’s brands.
SLD Group will do its utmost to expand its clientele and secure more projects by implementing the above- mentioned strategies, so as to deliver fruitful results and create value for its shareholders.
About Steve Leung Design Group Limited
Steve Leung Design Group Limited is an internationally renowned and award-winning interior design and interior decorating & furnishing company founded in 1997 by Mr. Steve Leung. Headquartered in Hong Kong, the Group has branch offices in Beijing, Shanghai, Guangzhou, Chengdu and Shenzhen, and with over 500 staff. The Group is second largest interior design services providers which did not provide any fitting-out services in the PRC and Hong Kong in terms of revenue for FY2017.
The Group has a wide spectrum of design projects that have been accredited with design awards in Asia Pacific region and worldwide. Overseas award-winning projects include Yuan at Atlantis The Palm, The Eight at Grand Lisboa Hotel in Macau; PRC projects include: One Park Shanghai, One Shenzhen Bay, Nanjing Mandarin Palace and Tang Island; and Hong Kong projects include: MX, yoo Residence II and more. The Group has become part of Jangho Group since 2014.
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