Changying Precision said that in 2017, the main reason for the change in operating performance of the Company was the replacement of large-size customers with less-than-expected orders. A number of newly developed international customers were in the research and development stage. The provision for bad debts was fully accrued to individual customers' accounts receivables ; Guangdong Fang Zhen New Material Precision Components Co., Ltd. (51% owned by the Company) acquired by the Company in late 2016, whose operating results in 2017 have not met the performance commitment. Impairment tests were conducted on the goodwill for impairment.
In addition, Changying Precision said in the interactive platform for investors that the company started to provide metal appearance products to Samsung mobile phones in 2017. At this stage, the number of products and delivery volume have greatly increased, but the main focus is on mid-range models On the Samsung S9 project company has not yet participated.
2017 iPhone new and Samsung S8 driven 'metal frame + glass back cover' program prevails, the metal frame especially stainless steel in the box on the processing requirements of complex technology to increase the difficulty.It is understood that the long-Ying precision large customers OPPO new last year Machine metal appearance of pieces of processing more difficult, coupled with the introduction of a new team, the cost control of a certain deviation, the relatively low profit margins, affecting some of the profits, product gross margin net interest rate is also declining, but with the metal The appearance of the pieces into the Samsung midrange models, long surplus precision market profitability in 2018 or will gradually improve.