Sound Global Ltd: Performed fairly well

- FY10 revenue of RMB1,766m (+36.5%y-y), net profit of RMB289m (+2.3%y-y)
- 4Q10 revenue of RMB550m (+65.9%), net profit of RMB109m (+75.5%y-y)
- Proposed dividend of 1 cents per share

FY10 revenue came in at RMB1,766m (+36.5%y-y as FY09: RMB1,293), which is 8% above our estimate of RMB1,634m. Net profit for FY10 came in at RMB289m (+2.3%y-y as FY09: RMB283m), which is 11% above our estimate of RMB260m. Net margin decline is partly due to additional but non-recurring expenses related to the listing on the stock exchange of Hong Kong and hence we expect margin to pick up in FY11.

We expect SGL to show some healthy growth in both its top and bottom line in FY11 as the bulk of its BOT projects will start to be operational by then (Fig. 5). All in all, SGL has a total of 16 BOTs of which 3 are already operational and we can expect another 6-7 more BOTs to be in operations by FY11.

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