[March 19, 2012 – Hong Kong] China Fiber Optic Network System Group Ltd. (“China Fiber Optic” or the “Company”, together with its subsidiaries the “Group”; stock code: 3777), the largest manufacturer of fiber optic patch cords in China, today announces its annual results for the year ended December 31, 2011 (the “year under review”).
During the year under review, the Group’s revenue surged 50.0% compared to the same period last year to RMB1,257 million (2010: RMB838 million). Gross profit increased by 49.1% to RMB399 million (2010: RMB268 million). The Group’s profit for the year saw a substantial increase of 39.2% to RMB253 million (2010: RMB182 million).
The Board has recommended not to declare final dividend for the year ended December 31, 2011. The Board believes that a clear dividend policy is important to our investors. Therefore the Board has resolved to adopt a policy of paying final dividend commencing fiscal year 2012.
Mr. Randy Hung, Executive Director and Chief Financial Officer of China Fiber Optic commented, “The global demand of fiber optic patch cords is no doubt in a growing trend. Global market size of fiber optic patch cords is now estimated to increase from USD2.69 billion in 2011 to USD4.58 billion by 2015. Growth drivers for our business will continue with the rising demand in the communication industry, in light of China’s rapid deployments of FTTx, three-network integration and increase 3G wireless communication coverage.”
During the year under review, increase in revenue was mostly contributed by sales to domestic customers. The Group’s domestic sales significantly increased by 61.3% as its customers continue to build and upgrade their fiber optic networks. Domestic sales of fiber optic patch cords alone surged by 71.7% to RMB1.012 billion due to the continued surge in demand for fiber optic patch cords by telecom network operators and broadcasting and television network operators in China. Overseas sales consisted of fiber optic patch cords shipped to customers in Ireland and New Zealand was RMB221 million in 2011, representing an increase of 13.0% compared to last year.
For the production capacity, the Group completed the construction of the two new production lines of fiber optic patch cords by the end of 2011 to bring up production capacity by 35% to 12 million sets of fiber optic patch cords per annum. Subject to the availability of local labor, the Group will continue to further expand its production capacity in 2012 to up to 18 million set of fiber optic patch cords per annum, in order to meet the market demand.