Pantech 2Q profit strengthens on lower expenses, improved trading segment

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KUALA LUMPUR (Jan 17): Pantech Group Holdings Bhd posted a net profit of RM11.19 million in the third quarter ended Nov 30, 2018 (3QFY19), up 11.3% from RM10.05 million a year earlier, mainly due to lower operating expenses and improved performance in its trading segment. 

This boosted earnings per share to 1.51 sen from 1.36 sen, the company's stock exchange filing today showed. Quarterly revenue, however, fell 10.5% to RM140.16 million, from RM156.62 million in the same quarter last year.

The group also declared a second interim dividend in the form of shares via the distribution of treasury shares, for the financial year ending Feb 28, 2019 (FY19). The distribution will be on the basis of one treasury share for every 100 existing shares held (1-for-100). The shares will be transferred to the accounts of shareholders on March 22.

For the nine months ended Nov 30, 2018 (9MFY19), Pantech's net profit rose a marginal 1.1% to RM36.18 million from RM35.77 million a year ago, as revenue inched up to RM466.6 million from RM465.22 million.

Going forward, Pantech said it is cautiously optimistic on the development in the oil and gas (O&G) industry, as the price of crude oil has continued to fluctuate.  

Meanwhile, it said trade tensions around the world has caused open trade to turn protectionist and this in turn is posing major challenges to its export business. This has resulted in its carbon steel manufacturing plant having to temporarily suspend its exports to the US. 

“Notwithstanding the above, the group see opportunities to secure more orders from the increased activities in upstream oil and gas activities in Malaysia and Southeast Asia,” it said. 

Pantech will continue to prudently focus on and expand its existing revenue-generating businesses and seek opportunities to grow its businesses, both locally and overseas, by expanding its capacity as a major pipes, valves and fittings solutions provider to the O&G industry, the filing added. 

Pantech shares slipped one sen or 2.17% to close at 45 sen today, bringing a market capitalisation of RM332.86 million. In the past 12 months, the stock has retreated over 28%.