Thursday 28 Mar 2024
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KUALA LUMPUR (Nov 26): Karex Bhd, the world's largest condom manufacturer, saw its net profit more than halve to RM1.98 million in the first financial quarter ended Sept 30, 2018 (1QFY19) from RM4.21 million a year ago, on lower sales.

This resulted in a lower earnings per share of 0.2 sen for 1QFY19 compared with 0.42 sen for 1QFY18.

Quarterly revenue also fell 14.3% to RM92.16 million from RM107.59 million a year ago, primarily due to lower sales from the sexual wellness segment.

In a filing with Bursa Malaysia today, Karex said sales contributed by the sexual wellness segment was scaled back by 15.9% to RM83.8 million mainly due to timing issues that delayed several large tender orders from being shipped out in time for the close of 1QFY19.

"Correspondingly, our inventories increased from RM119.3 million to RM136.1 million since the end of financial year ended June 30, 2018 (FY18)," it added.

On prospects for FY19, Karex said global condom demand is expected to continue to maintain an encouraging growth trajectory.

"However, the group remains wary of turbulence in the economic environment that has persisted in recent months. Erratic condom purchasing patterns have presented a challenging climate to condom manufacturers around the world," it said.

"In spite of this, we remain optimistic as our long-term prospects remain intact, as our group continues to capture orders from new markets whilst implementing additional automation into our manufacturing processes to remain cost competitive.

"Moreover, our branded segment has continued to develop, both in terms of product offerings and market coverage, providing a platform for sustainable growth in the future," Karex added.

Karex shares closed down 2 sen or 3.28% at 59 sen today, with 800,800 shares traded, bringing a market capitalisation of RM591.4 million. 

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