KUALA LUMPUR (May 23): Hextar Global Bhd reported its highest net profit ever in the first quarter ended March 31, 2022 (1QFY22) at RM15.65 million from RM10.75 million a year ago, driven by higher revenue, margins and growth from its specialty chemicals businesses.

As a result, earnings per share increased to 1.2 sen from 0.82 sen.

In a Bursa Malaysia filing on Monday (May 23), the group also recorded its highest quarterly revenue ever of RM153.63 million in 1QFY22, compared with RM114.82 million previously, largely due to a higher revenue contribution from its specialty chemicals business. 

On a quarterly basis, the group’s net profit rose by 9.7% from RM14.26 million for the immediate preceding quarter (4QFY21), while revenue inched up by 11.29% from RM138.05 million for 4QFY21.

Commenting on the group’s financial performance, Hextar executive director Datuk Eddie Ong Choo Meng said the result reflects the company's ability to continue the momentum achieved in the previous financial year. 

“Despite the challenges we faced in our operating environment from volatile raw material prices to supply chain disruptions, we have still been able to grow our revenue by 33.8% and net earnings by 54.6% in comparison to the corresponding quarter of the preceding year.

“We have also been able to improve our margins from 9.3% in 1QFY21 to 10.7% through higher margins for the specialty chemicals business,” he said.

Moving forward, he expects the group to continue to maintain its growth trajectory driven mainly by the specialty chemicals segment.

“The strong start to the year gives us confidence that we are on track to deliver strong results for the financial year ending Dec 31, 2022 (FY22),” he said. 

Separately, the group also announced its plan to acquire the entire share capital of Hextar Kimia’s two wholly-owned overseas subsidiary companies, namely Hextar Kimia (Australia) Pty Ltd and International Chemicals Engineering Pty Ltd, in order to consolidate its foothold in the Australian and New Zealand oil and gas markets for RM14.3 million cash. 

The group intends to leverage these two companies to promote its agrochemicals products to the respective markets. 

The acquisition will be financed through internally generated funds and is expected to be earnings accretive to the Hextar group starting from 3QFY22, it said. 

“These acquisitions demonstrate our commitment to growing our business regionally. 

“While Malaysia continues to be our key market, the acquisition of PTASR as well as Hextar Kimia (Australia) Pty Ltd and International Chemicals Engineering Pty Ltd will provide us immediate access to the Indonesian, Australian and New Zealand markets while allowing us to add to our capacity and geographic presence in respect of our core businesses.

“These acquisitions will enable Hextar to accelerate the expansion of our portfolio mix in respect of our chemicals business to drive our growth and margins,” said Ong. 

At noon break on Monday, shares in Hextar settled five sen or 2.99% higher at RM1.72, giving it a market capitalisation of RM2.26 billion.