The Motley Fool

Chart of the Week: Techtronic Industries and Powering Profits

Hang Seng Index constituent stock Techtronic Industries Co. Ltd (SEHK: 669) continues to reward shareholders. The power tools and floorcare appliances firm reported solid full-year 2019 earnings in early March.

Even though it was buffeted by the US-China trade war last year, the company navigated the landscape well. It posted a 9.2% year-on-year expansion in revenue to US$7.66 billion while net profit rose 11.3% year-on-year to US$615 million.

Its portfolio of brands, including Ryobi, Milwaukee, and Homelite, continues to garner customers. Its sales in its main North America market rose 10% year-on-year.

Growth on all fronts

What’s more, the company also raised its final dividend by a solid 16% year-on-year to HK$0.58 per share.

It’s had an extraordinary run of growth when it comes to its dividend. Paying out just HK$0.045 in its 2009 final dividend, Techtronic has managed to raise its dividend more than 12-fold over the past decade.

Clearly, this has been matched by a run-up in its sales growth and profit – as readers can see below. The question now, though, is whether the company can continue to post year-on-year growth in 2020.

With construction projects perhaps put on the back burner due to the coronavirus outbreak, use of power tools could be limited.

One bellwether Techtronic investors should watch out for will be earnings from large US-listed DIY retailer Home Depot (NYSE: HD). This should give an indication of how well Techtronic’s goods are selling.

Source: Techtronic Industries 2019 earnings presentation

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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 Hong Kong contributor Tim Phillips doesn’t own shares in any companies mentioned.