KUALA LUMPUR (Aug 24): Notion VTec Bhd, which saw its share price jump 77% within a month, has reported a net loss of RM10.86 million for the third quarter ended June 30, 2020 due to loss of orders and production loss, as its supply chain and customers were both impacted by the Movement Control Order.  

The precision parts manufacturer had reported a net loss of RM3.76 million in the preceding quarter, and a net profit of RM1.87 million for the previous year’s third quarter. 

Revenue for the April-June quarter totalled RM40.05 million, a 28.93% fall from RM56.36 million a year earlier, and a 35.73% decline from RM62.31 million in the preceding quarter.

“Orders in April and May were more than 50% down from previous months and fortunately, we had some stock to meet orders,” the group said in its filing with Bursa Malaysia. 

Notion Vtec said demand for its auto and electronic manufacturing services were sharply lower, while hard disc drive demand remained steady.  

The group noted there were delays in getting approval from the Ministry of International Trade and Industry (MITI) for partial resumption of operations. Work from home further caused disruptions for its production line, it added.  

For its cumulative nine-month period ended June 30, the group posted a narrowed net loss of RM446,000 versus RM4.49 million a year ago, while revenue stayed flat at RM172.7 million. 

On prospects, the group said it expects its venture into healthcare business via the manufacturing of face masks, to impact favourably in the next financial ending Sept 30, 2021.  

“We started initial production in early July and the learning curve is at times steep but we have reached a confident stage, where both three-ply surgical mask and PP [polypropylene] meltblown fabric are in production and sales has started. Novid is our brand,” it added. 

Notion VTec said it will expand its three-ply and meltblown capacity and include kids mask and N95 respirators, rendering the need for the additional purchase of a new factory. 

The group had decided to venture into the production of personal protective equipment and medical ventilator components in April. On July 30, it announced it has been registered with the US Food & Drug Administration as a face mask manufacturer — which lifted its share price to as high as RM2.34. 

The stock closed 19 sen or 12.5% lower at RM1.33 today, valuing the group at RM668.76 million. Some 74.37 million shares were traded. Over the past one year, the counter had spiked by 270%.

(Editing by S. Kanagaraju)