AMVIG : Announces 2016 Annual Results

【 For immediate release 】 21 March 2017

AMVIG Announces 2016 Final Results

Financial Highlights

For the year ended 31 December	2016 HK$million	2015 HK$million	Changes
Turnover	2,551	3,265	‐22%
Profit attributable to owners of the Company	176	256	‐31%
Add: Exchange loss	91	146	‐38%
Underlying profit attributable to owners of the Company	281*	402	‐30%
Earnings per share (HK cents)	18.9	27.7	‐32%

* On a constant currency basis at the annual average exchange rates in 2015

(21 March 2017, HONG KONG) AMVIG Holdings Limited (the "Company" or "AMVIG", stock code: 2300) and its subsidiaries (collectively known as the "Group") announced today its audited consolidated results for the year ended 31 December 2016 (the "Reporting Period").

During the Reporting Period, the Group's turnover decreased by 22% in 2016 to HK$2,551 million from HK$3,265 million in 2015. Gross profit margin slightly decreased from 31.8% to 30.9%. Profit attributable to owners of the Company, dropped from HK$256 million to HK$176 million. However, excluding the exchange losses of HK$91 million, and on a constant currency basis, the underlying profit attributable to owners of the Company during the Reporting Period was HK$281 million. Earnings per share was HK18.9 cents, representing a decrease of 32%, as compared to 2015.

The Board of Directors of the Group recommended the payment of a final dividend of HK2.2 cents per share and proposed final special dividend of HK1.1 cents per share for 2016. Together with an interim dividend of HK5.4 cents, interim special dividend of HK2.7 cents, total dividend for the year was HK11.4 cents per share.

Commenting the Group's annual results, Mr. Billy Chan, Non‐executive Chairman of AMVIG, said, "It has been a difficult year for the China tobacco industry in 2016. Tobacco sales and volume decreased for the first time in two decades by 5.6% and 8.1%, respectively. Overall profits and taxes had dropped by 5.6%. This was mainly due to the over‐accumulation of inventory at the end of 2015. In addition, the continuous austerity measures in China had also impacted the sales of high‐end cigarettes.

The above mentioned factors, together with the change in designs of health warning labels has impacted our sales, as our customers scaled back their purchases to clear their inventories. Although the situation had improved in the second half, the substantial shortfall in the first half has reduced the Group's overall turnover for the year. The net profit of the Group dropped accordingly.

On the acquisition front, the Group has increased our shareholding in our Hubei plant from 30% to 60% in 2016. In addition, we have also completed the acquisition of a 60% equity interest in a production plant in Hebei in the second half of the year."

Looking forward, Mr. Chan said, "After a turbulent year, the State Tobacco Monopoly Administration has set

a targeted production volume for 2017 at 47.3 master cases. However, there will be challenges for the Group since the sales of high‐end tobacco products is expected to decline due to the austerity measures. The management is of the view that the long‐term fundamentals of the tobacco market will remain stable. Towards this and as mentioned in our previous reports, we have increased our investments in research and development so that we can fulfil the expected demands for innovative products and packaging designs from our customers. Together with the Group's ongoing initiatives to cut costs and improve efficiencies will continue. Major efforts will be made to centralize various functions to further streamline the operations."

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AMVIG Holdings Limited (2300.HK)

Established in 1998, AMVIG Holdings Limited, formerly known as Vision Grande Group Holdings Limited, is principally engaged in the printing of high quality cigarette packages and the manufacturing of transfer paper and laser film, which are the major raw materials for cigarette packages. The Company is the leading cigarette packaging printing specialist in the People's Republic of China in terms of turnover, profitability, output and production capacity.

For further information, please contact:

AMVIG Holdings Limited

Comet Siu

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