KUALA LUMPUR (May 21): PIE Industrial Bhd reported a net profit of RM11.73 million for the first quarter ended March 31, 2021 (1QFY21) versus a net loss of RM3.56 million a year ago.

"The increase was mainly attributable to higher revenue, income from scrap sales, and reversal of provision for slow moving inventories in the current quarter as compared to the corresponding quarter.

"However, the improvements noted above were offset against higher administrative and distribution expenses as well as loss from foreign currency exchange transactions," said the Penang-based electronics manufacturing services (EMS) provider in a filing with Bursa Malaysia.

It posted earnings per share of 3.14 sen, compared with a net loss per share of 0.64 sen a year ago.

Quarterly revenue more than doubled to RM263.17 million from RM100.7 million a year ago, thanks to higher demand from new and existing customers for electronics manufacturing, raw wire & cable products and wire harness products.

On a quarter-on-quarter (q-o-q) basis, revenue increased by 6.6% from RM246.87 million in 4QFY20. Its net profit, however, fell 67.1% q-o-q from RM35.68 million.

"The decrease was mainly due to higher administrative and distribution expenses, loss from foreign currency exchange transaction and provision for impairment of trade receivables but was offset against higher income from other investments," it noted.

For  EMS activity outlook, the company expects orders to increase in the long run.

"As demand for mobile energy devices is expected to be in big demand in the future, the management has invested in artificial intelligence and a new research and development division at the beginning of FY21 to enhance manufacturing capabilities and competitive edge as the preferred EMS player," it added.

For its manufacturing activity of raw wire & cable, while the price of copper has been increasing since end of last year, the company said this division is able to maintain its profit margin as the selling price quoted to customers is pegged to the copper price determined according to the market.

Even though the division is also seriously affected by global Covid-19 pandemic and Movement Control Order, the company said this segment is expected to maintain its profit margin as usual and secure more orders from its customers.

PIE's share price fell two sen to RM2.53, valuing the group at RM972 million.