KUALA LUMPUR (Aug 18): Hard disk drive (HDD) manufacturer JCY International Bhd swung to a net loss of RM28.6 million or 1.39 sen loss per share for the third financial quarter ended June 30, 2016 (3QFY16), from a net profit of RM32.55 million or 1.59 sen a share a year ago, mainly due to lower revenue and a RM13.2 million one-time write-off of properties, plants and equipment in the current quarter, due to cessation of its operation in Foshan, China.
Revenue fell 28.3% to RM343.84 million from RM479.75 million on lower sales volume and average selling price recorded in 3QFY16, despite at favourable U.S. dollar exchange rate against the ringgit.
It declared a third interim dividend of 1.25 sen per share for the financial year ending Sept 30, 2016 (FY16), payable at a date to be determined and announced in due course.
The weak quarterly results dragged net profit for the cumulative nine months (9MFY16) to RM6.37 million, down 95.2% from RM133.89 million in 9MFY15. Revenue also dropped 10% to RM1.33 billion, from RM1.48 billion a year ago.
On prospects, JCY said demand for HDD digital storage capacity continued to increase by 7% over the last quarter.
"For enterprise, desktop, mobile and consumer applications, HDDs continue to maintain cost competitiveness over solid state drives. Average size per drive now exceeds one terabyte for non-enterprise solutions, and major hyperscale customers are beginning to transition to 10 terabyte drives.
"These developments mean that with larger capacity drives, demand for baseplates and actuators is not increasing commensurately. The global demand for HDD continues to stand at around 100 million units per quarter," it said in a filing with Bursa Malaysia today.
Going forward, JCY said it will strive to leverage its operational efficiency and economies of scale to achieve reasonable returns from its business. "We are also exploring the possibilities of leveraging our capabilities in other fields."
JCY shares closed 3 sen or 4.96% higher at 63.5 sen today, for a market capitalisation of RM1.33 billion.