Mail and retail segments drag down Pos Malaysia's 2Q net profit

Mail and retail segments drag down Pos Malaysia's 2Q net profit
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KUALA LUMPUR (Nov 23): Pos Malaysia Bhd's net profit plunged 89.8% to RM3.48 million or 0.65 sen per share for its second financial quarter ended Sept 30, 2015 (2QFY16) from RM33.99 million or 6.33 sen per share in 2QFY15.

The national postal company attributed the lower earnings to the lower profits from the mail and retail segments, caused by higher transportation cost for transhipment business and recognition of expired postal order in 2QFY15.

However, its revenue for the current quarter came in 7.3% higher at RM398.8 million from RM371.67 million a year ago, underpinned by its mail and retail segments, which registered an increase in turnover of 11% and 15.3% respectively during the quarter.

For the first half of FY16 (1HFY16), Pos Malaysia posted a 57.1% decline in net profit to RM26.22 million or 4.88 sen per share from RM61.1 million or 11.38 sen per share a year ago due to the same reasons.

Revenue for 1HFY16 gained 6.6% to RM789.17 million from RM740.46 million in 1HFY15.

Going forward, Pos Malaysia said its revenue growth will be mainly driven by the growth in products and services related to e-commerce, namely courier, small packets and parcels products.

Although the e-commerce growth trend is expected to have long-term potential, it pointed out that the softening near-term economic and market sentiments are expected to be challenging for the group's prospects.

Shares in Pos Malaysia closed seven sen or 1.83% higher at RM3.89 today, bringing a market capitalisation of RM2.09 billion.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)