Poh Huat reports lower Q4 net profit

PETALING JAYA: Poh Huat Resources Holdings Bhd’s net profit for its fourth quarter ended Oct 31,2019, dropped 29% to RM14.83mil from RM20.86mil in the previous corresponding period, mainly due to higher distribution and selling costs, as well as a much lower foreign exchange gains recognised during the period.

In a filing with Bursa Malaysia yesterday, the furniture maker said that revenue in the fourth quarter however increased to RM192.08mil from RM189.51mil a year earlier.“Our Malaysia operations continue to do well as we received sustained orders for our panel-based bedroom sets for the US market.

“Furniture distributors and retailers in the US are ordering more panel-based bedroom furniture to cater for the younger generation of urban dwellers who are more budget conscious and comfortable with ready-to-assemble home furniture.”

The company said shipment of traditional office furniture to its traditional markets remained strong.

“Shipment of furniture from our Vietnam operations remained stable, particularly for the affordable range of spray-painted bedroom sets in line with our customers’ focus on the broader segment of the US furniture market.”

For its financial year ended Oct 31,2019, Poh Huat’s net profit increased to RM50.90mil from RM47.14mil in the previous corresponding period, while revenue improved to RM701.00mil from RM621.93mil a year earlier.

“Gross margin rose from 16.42% to 17.52% during the same period. The improvement in gross margin is attributable mainly to the lower raw material costs and overall reduction in factory overheads as a percentage of sale due to the better plant utilisation rate for the current financial year, ” said Poh Huat.

On its prospects going forward, the company said the low unemployment and wage growth amidst tighter labour supply have resulted in sustained growth in household income and consumer confidence in the US.

Source: TheStar