KUALA LUMPUR (Nov 17): Shares of Teo Seng Capital Bhd rose as much as three sen or 4.11% to 76 sen on Wednesday’s morning trade on the back of growth in net profit for the third quarter ended Sept 30, 2021 (3QFY21), underpinned by the favourable factor of improved egg selling price from the poultry farming segment and sustainable performance of its investment and trading segment.

At the time of writing, Teo Seng had risen four sen or 4.79% to 77 sen apiece with some 389,100 shares transacted.  

At 77 sen, the stock has a market capitalisation of RM214.51 million.

The stock was traded between 76 sen and 79 sen on Wednesday.

Teo Seng is principally involved in poultry farming. The company, via its subsidiaries, is also involved in the manufacturing and marketing of paper egg trays and animal feeds, along with the distribution of animal health products.

The group’s net profit for 3QFY21 soared 83.9% to RM2.28 million from RM1.24 million in 3QFY20 on higher revenue. As a result, earnings per share rose to 0.77 sen from 0.42 sen previously.

Quarterly revenue rose 17.48% to RM144.53 million versus RM123.02 million a year ago, on the back of improved egg selling price along with the increasing demand for eggs as business resumes.

For the nine months ended Sept 30, 2021 (9MFY21), Teo Seng posted a net loss of RM9.05 million compared with a net profit of RM6.33 million as 9MFY21 revenue declined by 5.07% to RM378 million from RM359.75 million. The group noted that the continued high commodity prices of maize and soybean meal are the adverse industrial impacts and challenge towards the poultry industry despite the resumption of the domestic economy.

“The uncertain market conditions continued to be existed such as fluctuation of market demand and supply situation, increasing operating cost, labour supply, [and] fully integrated egg producers with competitive advantages will be more resilient to face this challenging situation.

“Following the country’s National Recovery Plan, the outlook of poultry industry is bright for integrated egg producers incorporating environment, social and governance (ESG) framework in their business strategies in order to promote and achieve sustainability,” the group commented on its prospects.

Moreover, it noted that its board is more prudent to manage the group’s financial resources and capex requirements.

“Teo Seng continues to focus on production efficiency and cost-effectiveness to sustain its financial performance, enhance competitive advantages and create more value and confidence to our shareholders and other stakeholders. In order to normalize the business, the pandemic has to be under control,” it added.