Hangzhou Hikvision Digital Technology, a key camera supplier for China’s surveillance system, reported the slowest annual pace of profit growth in more than a decade amid growing headwinds in overseas markets.
Net income in 2018 rose 20.5 per cent to 11.3 billion yuan (US$1.76 billion), the Hangzhou-based company said in a filing to the Shenzhen Stock Exchange on Thursday. Revenue climbed 23 per cent to 51.2 billion yuan.
The company said it maintained a high level of investment into research development while continuing to develop domestic and overseas markets. Its shares have risen 28 per cent this year, outpacing the 10 per cent gain in the Shenzhen Composite Index.
Hikvision has grown into the world’s biggest supplier of surveillance cameras amid booming demand from governments seeking to increase coverage of public areas in the face of rising terrorism threats and to deter crime.
Founded in 2001, Hikvision has morphed from a former Chinese government research institute into a US$39 billion business specialising in professional video surveillance cameras. It is now a supplier to hundreds of government-led surveillance projects in major cities including Shanghai, Hangzhou and Urumqi, where its cameras can take clear shots of vehicles and passengers even in poor visibility conditions.
Hikvision expanded into the consumer market in 2013 with EZVIZ, a brand that makes surveillance equipment for the home and office.
Hikvision’s products are in use in more than 150 countries and regions globally including the US and the UK. The Chinese company has faced increasing resistance and scepticism in overseas markets with critics contending that its products could be used to aid the Chinese government in spying.
The US Senate passed the 2019 National Defence Authorisation Act in August, which prohibits the government from buying Chinese-made surveillance equipment from several Chinese firms including Hikvision and Hangzhou-based Zhejian Dahua Technology.
Hikvision has previously supplied equipment to the US Army to monitor its base in Missouri and to the Memphis police department, according to The Wall Street Journal.
In September last year, Australian media reported that devices from Hikvision and Dahua were being used for spying in the country. The two companies supply most of the surveillance cameras installed in Australia, according to the reports.