Pelikan sees return to profitability by 2016

Loo:

SUBANG JAYA: Having undergone a lengthy period of streamlining its European assets, loss-making Pelikan International Corp Bhd now expects its business to return to profitability by 2016.

“We believe we will resolve all the challenges we are facing by next year,” Pelikan president and chief executive officer Loo Hooi Keat told reporters after the company’s AGM.

According to Loo, the European market alone could contribute about 20 million euros (RM84.68mil) in earnings before interest and tax to Pelikan.

The stationery manufacturer and distributor, which in April completed an asset-injection exercise into its German-listed unit Pelikan AG, saw its net loss narrow to RM10.7mil, or 1.95 sen per share, for the first quarter ended March 31, 2015, from RM11.2mil, or 2.20 sen per share, in the corresponding period last year.

The group’s revenue fell almost 10% to RM282mil during the period in review from RM312.6mil previously due mainly to the depreciation of the euro, which was its main revenue currency, against the ringgit.

Attributing the group’s losses in the recent quarter and 2014 to foreign exchange translation costs, Loo said the company’s books this year would likely still be affected by currency volatility.

“If the US dollar continues to strengthen, we will definitely be hit,” he conceded.

Nevertheless, Loo asserted that Pelikan was aggressively addressing the challenges its business was facing. “Ours is a global business, so it can be hard to foresee the risks that we could be facing ... unlike companies whose businesses are mainly domestic-based where it could be easier for them to predict the market trends,” Loo explained.