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TWST: We'd like to begin with a brief historical sketch of Comtech Group
and a picture of the things you are doing at the present time.
Mr. Kang: Comtech is a leading customized module design service company
within China. We serve the Chinese tech manufacturing industry with
sales to both multinational and domestic corporations. Our customer base
includes over 200 blue chip companies, primarily in three major market
segments: telecom equipment, mobile handsets, and digital consumer
electronics. Because of our extensive relationships within those three
major segments, most investors view COGO as a good proxy for China's
tech manufacturing industry. Our business does not rely on one single
customer but rather from a diversified base of highly recognizable
OEM/ODM customers. Through a recent acquisition we have broadened our
product offering to include business and engineering services that will
complement our customized module design service business. We are
optimistic about our prospects for each business as we look to further
leverage our installed base of China OEM/ODM customers. COGO has over
10 years of operating history, and since inception, the company has been
profitable in every single quarter. I founded this company in 1995 with
my initial $50,000 investment, and over that 10-year period we have
successfully grown entirely through, organic growth. This is a high-
growth company. Over the last five years, our average growth in net
income during each year was over 70%. During the Q106, our revenues
increased over 60% and net income increased over 70%. Based on the
guidance that we provided for 2006, we are expecting revenues to grow
over 30% and net income to grow over 60%, which would translate into pro
forma EPS (excluding stock compensation) of approximately $0.52 or a 44%
increase from last year. We believe that this high-growth momentum
continues to be very strong and we feel confident in further growth into
the foreseeable future. I hope this gives you a quick snapshot into our
operations and a sense of our excitement and optimism surrounding our
growth prospects in the marketplace.
Tickers included in this excerpt: COGO
For more information call (212) 952 7433. The
Wall Street Transcript does not endorse any of the comments made by interviewees, and does
not make stock recommendations.
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