Mainboard listed Valuetronics Holdings' second quarter net profit rose more than 10 times to HK$39.6 million (S$6.3 million) from HK$3.3 million.

Revenue for the contract manufacturer climbed by 6.1 per cent to HK$632 million for the three months ended Sept 30.

This was due to an increase in demand from some of its industrial and commercial electronics customers and consumer electronics customers as well as no further expenditure having been incurred for its loss-making licensing business, which was terminated in the previous financial year.

Gross profit increased by 16.3 per cent to HK$84 million while its gross profit margin improved from 12.1 per cent to 13.3 per cent.

The change in gross profit margin reflected the change in product sales mix during the period reviewed.

Selling and distribution costs grew by 20.1 per cent to HK$10.8 million, mainly due to increases in logistic costs to deal with the increase in sales volume and commission expenses for sales representatives.

Administrative expenses increased by 7.8 per cent to HK$30.8 million, mainly due to salary increases.

Half year earnings per share swelled to 20.1 HK cents from to 8.1 HK cent previously while net asset value per share firmed to 176.5 HK cents compared to 164.5 HK cents as at March 31.

Business conditions remain challenging, which include rising wages and costs in China.

This notwithstanding, the group continued to experience improvement in demand and orders.