KUALA LUMPUR (Sept 26): The drop in gold prices has weighed on Poh Kong Holdings Bhd’s net profit for the fourth quarter ended July 31, 2018 (4QFY18).

The company’s net profit shed by 38% to RM8.93 million, or 2.17 sen per share, from RM14.3 million or 3.49 sen per share in the previous corresponding quarter as the fluctuation in gold prices affected its operating profits, according to a filing with Bursa Malaysia this evening.

Its quarterly revenue,however, went up 4.7% to RM272.2 million during the quarter under review compared with RM260 million a year ago driven by higher demand for gold jewellery and gold investment products and additional revenue contributed from new outlets in the current quarter under review.

In a separate filing with Bursa, the board of directors recommended a first and final single tier dividend of one sen per share in respect of the financial year ended July 31, 2018 (FY18), subject to the approval of shareholders at the forthcoming sixteenth annual general meeting (AGM).

For the full FY18, the group’s annual net profit declined by 20.7% to RM23.4 million compared with RM29.5 million recorded in FY17. Poh Kong’s annual revenue for FY18 however grew by 14.4% to RM1 billion from RM877 million recorded in the previous corresponding financial year.

Moving forward, the group is optimistic of maintaining its growth and leading position in Malaysia despite more challenging and competitive conditions in the domestic jewellery market.

“Notwithstanding uncertainties in the global and regional economies, fundamentals in Malaysia remain resilient which have enabled corporate and industry players to meet their challenges and business performance.

“The group, being cognisant of the current market situation continues to review, revise and consolidate its business strategies to meet these challenges,” it said.

Poh Kong’s share price gained by one sen to close at 49.5 sen with 100,600 shares traded, giving it a market capitalisation of RM203.1 million. Over the last year, the share price has seen a decline of about 30.6%. At current level, it is trading at a trailing P/E of 8.6 times with a dividend yield of 2.02%.