Tan Chong's full-year net profit up 80% on investment gains

Automotive firm Tan Chong International has posted an 80 per cent rise in its net profit for the year to HK$1.08 billion, mainly due to a revaluation gain on its investment properties.

Revenue, meanwhile, climbed just 3 per cent to HK$6.5 billion.

A doubling of sales in Tan Chong's heavy commercial vehicle and industrial equipment distribution business helped to offset an 11 per cent fall in its motor vehicle sales.

Tan Chong distributes Nissan and Subaru vehicles in Singapore.

It also sells Subaru vehicles in Hong Kong, certain provinces of China and some Asean countries.

In Singapore, "the higher cost of Certificates of Entitlement (COE) and the strong Japanese yen during most of 2012 reduced our price competitiveness in Japanese passenger cars and consequently sales were lower than the previous year," the firm said in a statement today.

In China too, sales of Japanese cars dropped because of "poor buyer sentiment caused by the Sino-Japanese rhetoric over territorial sovereignty", it added.

Commercial and industrial vehicle sales, however, was better.

"Our Nissan commercial vehicles, however, maintained sales leadership locally from a fortuitous combination of product suitability and lower import tax rate for such vehicles," Tan Chong said.

In Thailand, the improving economy also helped to boost sales of trucks and forklifts.

The firm's property rentals in Singapore also improved last year as its service apartments at Wilby Central were fully operational and rental rates improved.

Earnings per share for the year rose to 53.5 HK cents from 29.8 HK cents the year before.

The board has recommended a final dividend of seven HK cents per share, payable on June 13.