Friday 29 Mar 2024
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KUALA LUMPUR (May 25): Power Root Bhd has slipped into the red in its fourth quarter ended March 31, 2018 (4QFY18) with a net loss of RM9.51 million, bringing its full financial year ended March 31, 2018 (FY18) earnings sharply lower.

The group registered a net profit of RM9.36 million in 4QFY17.

Revenue for the quarter, meanwhile, fell 12% to RM80.58 million, from RM91.6 million in 4QFY17, mainly attributable to the decrease in overseas sales.

In a stock exchange filing, the group said the losses were due to lower sales recorded and adverse sales mix.

This was exacerbated by a writedown of inventories, impairment loss on property, plant, equipment, trade and other receivables, as well as lower gain on foreign exchange in the quarter.

The beverage manufacturer had recorded a net profit of RM6.42 million for its 3QFY18.

For FY18, Power Root said net profit slid 78.3% to RM9.44 million from RM43.53 million a year ago. Revenue, however, stood higher at RM424.58 million, against RM399.3 million in FY17.

The group proposed a fourth interim single tier dividend of 0.5 sen per share, in respect of FY18.

In the past six years, Power Root had maintained its annual net profit in the range of RM35 million to RM48 million, according to its annual report.

Going forward, the group said it will increase activities in growing its existing export markets, and develop new markets through new products development, besides strengthening its distribution networks.

It will also work on improving operational efficiencies and cost management activities in the coming year, to maintain its competitive edge in a challenging operating environment.

Separately, Power Root has proposed to undertake a one-for-five bonus issue, and free warrants, of up to 71.24 million new shares.

Power Root estimated that the proceeds raised from the exercise of warrants later on could range between RM95.05 million and RM104.61 million. The proceeds will be earmarked for its capital expenditure and working capital, which may include the repayment of bank borrowings, payment of trade and other payables, employee costs, as well as marketing and administrative expenses.

The bonus issuance is also expected to provide shareholders of the company with greater participation in the company and encourage trading liquidity on the local bourse, it said.

"The board confirms that the share price adjusted for the proposed bonus issue of shares is not less than 50 sen, based on the daily volume-weighted average price during the past three-month period up to the lates practicable date (May 21)," it said in its filing.

The entitlement date will be determined and announced at a later date, it added.

At market close today, shares in Power Root fell two sen or 1.31% to RM1.51, giving it a market capitalisation of RM488.68 million.

 

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