Deswell Industries Inc. continues to expand its facilities and capabilities in southern China, and reports dramatic increases in profit and sales.
Sales of plastic parts and components accounted for 55.6 percent of the company total for the fiscal year ended March 31. The plastics-related sales amounted to US$24.8 million, compared with $18.7 million for the previous year.
Recently, the firm's plastics molding subsidiary, Jetcrown Industrial Ltd., leased another 55,000 square feet of factory space in Shenzhen, China. The space adjoins an existing facility of 225,000 square feet.
Deswell operates 145 Mitsubishi, Sodick and Kawaguchi injection molding machines with clamping forces of 50-1,600 tons. The largest machine, from Mitsubishi Heavy Industries, arrived in mid-1996 and molds photo copying machine cases, television cases and projection models, and motor industry moldings.
Of the new 55,000 square feet, Deswell allocated 15,000 for injection molding, 10,000 each for tooling and silk screening, and 20,000 for warehousing.
In addition to injection molded plastic parts and components, Deswell makes electronic products and subassemblies for original equipment manufacturers and contract manufacturers. Deswell's other subsidiaries are Kwanasia Electronics Co. Ltd. and Kwanta Precision Metal Co. Ltd., both in Dongguan, China.
Hong Kong-based Deswell employs about 1,500 and reported profit of $8.7 million on sales of $44.5 million for the fiscal year ended March 31. The company had profit of $5.9 million on sales of $30.6 million for the previous fiscal year.
The company spent $8.5 million for state-of-the-art machines, ``which play a vital role in accommodating Deswell's rapid growth,'' Richard Lau, chief executive officer, said in a release.
Sales of $12.7 million in the fourth quarter represented a 69 percent increase over the previous year's comparable quarter.
In mid-1995, Deswell completed an initial public offering of common shares and warrants. Both trade on the Nasdaq market.