How Does Sunningdale Tech Ltd Make Money?

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Sunningdale Tech Ltd (SGX: BHQ) is a manufacturer of precision plastic components. For investors who are looking to invest in Sunningdale, it is essential for them to know how the company brings in the revenue. Buying shares in a company without knowledge of how it makes money is not advisable.

With that, let’s look at the revenue contribution of each of Sunningdale’s business segments for the financial year ended 31 December 2017 (FY2017):

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Source: Sunningdale Tech Ltd 2017 annual report

The Automotive business segment mainly produces faceplates to be used in cars such as on the audio systems, speedometers, steering switches and exterior antennas. In 2017, this segment accounted for 36.4% of Sunningdale’s total revenue of S$724.5 million.

Next, the Consumer/IT division fabricates IT, consumer and telecommunication products such as point-of-sale terminals, grooming products and inkjet cartridges. This segment, in 2017, brought in the bulk of total revenue for Sunningdale at 39.3%.

Moving on, the Healthcare business segment mainly manufactures drug delivery and diagnostic devices. Last but not the least, the Mould Fabrication division creates moulds to be used in the manufacturing of plastic injection parts.

The following shows the geographic breakdown of revenue in 2017 and 2016:

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Source: Sunningdale Tech Ltd 2017 annual report

Around 45% of 2017’s total revenue was from China and Hong Kong, followed by 43% from Singapore, Indonesia and Malaysia.

Now that we know the basics of Sunningdale’s revenue streams, we can then delve into other aspects of the firm such as its profitability, strength of its balance sheet, its cash-generating abilities and so on before deciding to invest in it.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Sudhan P doesn’t own shares in any companies mentioned.

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