Thursday 28 Mar 2024
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KUALA LUMPUR (Aug 21): D&O Green Technologies Bhd's net profit more than doubled year-on-year to RM8.13 million in the second quarter ended June 30, 2018, from RM3.71 million previously, supported by a stronger ringgit which improved its gross margin.

The company also attributed the higher earnings to better cost management and production efficiency improvements.

Quarterly revenue grew 11% to RM113.26 million, from RM101.77 million a year ago. Its earnings per share improved to 0.78 sen from 0.37 sen, according to its quarterly results filing today.

For the cumulative six months ended June 30, 2018 (1HFY18), the company saw its net profit rise 52% y-o-y to RM13.26 million from RM8.7 million, as revenue inched up 3% y-o-y to RM226.35 million from RM220.13 million.

Going forward, its management expects 2HFY18 to be better than 1HFY18, "bolstered by seasonality factors and the commercialisation of new business wins, especially for the exterior automotive lighting applications such as RCL (Rear Combo Light)".

"Geographically, growth is expected to be broad based with expected higher percentage growth achieved for newer markets such as the US and Japan on low base effect," said D&O.

Capital expenditure (capex) in 2HFY18 is expected to be about RM38 million, compared with RM16.3 million in 1HFY18, said D&O adding that the higher capex is for the renovation of the new building and laboratory expansion of about RM10 million and RM5 million, respectively.

Meanwhile, renovation works at the new factory building next to the group's 89.79% subsidiary Dominant Opto Technologies Sdn Bhd's existing plant has started in July 2018 and will be carried out in three phases over a six-year period from 2018 to 2023 at a total estimated cost of RM40 million, comprising civil and mechanical and electrical works, excluding equipment and machinery cost.

D&O said Phase 1 of the renovation plan, comprising the office building, is expected to be completed by 2QFY19 at a total cost of RM29 million.

Shares of D&O closed half a sen or 0.66% lower at 75 sen for a market capitalisation of RM780.11 million.

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