KUALA LUMPUR (Oct 29): Unisem (M) Bhd's share price slipped as much as 18 sen or 7% to RM2.38 this morning, after the semiconductor firm last Friday announced its first quarterly net loss since 2013.
At 10.29am, the stock was still down 16 sen or 6.25% at RM2.40 apiece, against the overall positive market breadth on Bursa Malaysia, where gainers outstripped decliners at 279 versus 223.
In fact, Unisem's share price had headed south even before the release of its corporate earnings last Friday.
On Friday, the semiconductor manufacturer said it incurred a net loss of RM3.21 million for the third quarter ended Sept 30, 2019 (3QFY19), versus a net profit of RM35.15 million a year ago, due to expenses arising from the closure of its Batam unit, PT Unisem.
There was also a higher recognition of deferred tax expense due to the reversal of retirement benefits in the Indonesian operation, besides the lower gain on foreign exchange.
Due to these same reasons, its nine-month (9MFY19) net profit shrank by 76% to RM17.31 million from RM72.34 million in 9MFY18, while revenue dropped 8.6% to RM931.37 million from RM1.02 billion.
Kenanga Research analyst Adrian Kok said Unisem will likely experience another soft quarter going forward, given the expected final severance payout for the closure of the Batam plant.
The analyst downgraded the stock to "Underperform" from "Market Perform" with a target-price cut to RM2.15, from RM2.40 previously.
"Given this set of disappointing results, expectations of another soft quarter ahead, and 34% share price appreciation since September 2019, we believe the risks outweigh the rewards at this juncture," Kok wrote in a note this morning.
Over at ViTrox Corp Bhd, it is still struggling to recover. ViTrox's share price heads south for the third day in a row, after its latest corporate earnings triggered a flurry of analysts downgrade and earnings forecast trim.
The stock fell 26 sen or 3.4% to RM7.33 earlier this morning, and was still trading at RM7.37 — down 22 sen or 2.9% — at the time of writing.
On Oct 24, ViTrox said its net profit halved to RM13.86 million or 2.94 sen per share for the third quarter ended Sept 30, 2019 (3QFY19), from RM28.02 million or 5.96 sen per share for the year-ago quarter, due mainly to sales volume decline.
Since then, ViTrox has lost 70 sen or 8.7%, valuing the electronic component inspection equipment manufacturer now at RM3.47 billion.