EXCLUSIVE:Chinese TV & Appliance Brand Hisense Profits Plunge 44%, 2020 Sales Down 20%
Chinese TV and appliance Company Hisense has reported a massive 44% slump in profits and a 20% fall in revenues in 2020, which they have blamed on COVID-19 despite several competitors reporting record sales.
The Company who is facing an anti-Chinese sentiment for their TV’s and appliances has been accused of buying market share in 2019 to bolster sales. This is same Company who recently laid off 2,200 people in Europe.
In their latest filings with the Australian Securities & Investment Commission that in 2020 the Company has witnessed a 20% fall in revenue after the Company increased sales in 2019, from $279M to $314M an increase of $35M.
Profits fell 44% to $5,230,669 from $8,532,549 from the same period for the prior year. Hisense also own the ASKO appliance brand and at this stage it’s not known whether the ASKO sales were included in the 2019 revenues for Hisense.
Currently the Company is facing a new crisis with several retailers telling ChannelNews that consumers are today questioning whether a product is made by a Chinese Company.
Another blow for Hisense is that the fall in profits follow on from a move by the Company to try and position their products in the premium TV and appliance market.
Last year the Company launched new Signature TV’s and a $2,999 French door refrigerator which spec wise was very similar to the AKAI French door refrigerator which went on sale at Appliances Online for sub $1,000.
The Company said that as a result of “social distancing and new rules introduced by State Governments” the Companies business had been impacted.
There was no mention of the fact that the Companies manufacturing operations are in Hubei Province in the People’s Republic of China, this is where the city of Wuhan is located where the COVID-19 pandemic broke out.
This year retailers have reported record sales of TV’s and appliances with the biggest problem now facing suppliers is a lack of stock due to manufacturing, shipping and component supply problems.
Despite a big increase in sales the Company cut back ‘employee benefits. It also appears that the Companies investment in sport via the NRL which is believed to have cost the Chinese business around $2M is faltering.
This year and since the resumption of NRL Live TV coverage viewing on the Nine network and Fox Sports has slumped due to part to the poor performance of Queensland teams.
The Company also reported several new Chinese nationals as director
Xifeng Zhang and Youbo Li were appointed as directors as of March 2020, while Longhan Ke who was a director from the beginning of the financial year resigned on 21 March 2019.
The Company claims that they have a “strong balance sheet and cash reserves”.