China Electronics Holdings’ 6-Month Profit More Than Quadruples
China Electronics Holdings (OTCBB:CEHD) announced today that profits for the first half of 2010 increased more than fourfold on a year-over-year basis.
For the first half of 2010, the household appliances and consumer electronics retailer recorded profits of $9.3 million-a 441% increase from the same period last year. Revenue for the period also ballooned, increasing 382% year-over-year to $55.8 million.
China Electronics currently has a profit target of $12 million for fiscal 2010.
New products and the improved economic climate in China both contributed to the impressive growth, the company said.
China Electronics' products are mainly distributed in China's rural areas. In contrast to the saturated appliance markets in large Chinese cities, the company believes rural markets will experience demand growth.
A survey done by the China Electronic Product Association showed that 14% to 33% of rural families are willing to buy televisions, DVDs, washers and dryers, and telephones in the next few years. Also, almost every family owns a refrigerator in major Chinese cities while the ownership of refrigerators is only 22.7% in rural areas of China.
Currently, about half of China's population lives in rural areas.
Through its subsidiary, Lu'an Guoying Electronic Sales, the company operates more than 1,000 stores located primarily in rural China's Anhui, Henan and Hubei Provinces.
The company's share price has rallied 5% intraday to trade at $3.73 as of 10:01 am ET.
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