PETALING JAYA: Industrial manufacturer Luxchem Corp Bhd
is maintaining a cautious outlook as it moves further into 2023.
In a filing with Bursa Malaysia yesterday, it cited several key challenges such as exchange rates of the ringgit against the dollar in a rising interest rate environment, raw material price fluctuations, raw material demand and supply situations.
It added that stiff competition, as well as the ongoing conflict between Russia and Ukraine, were also reasons for its guarded outlook.
The company released its results for the quarter ended Dec 31 2022, which is also its financial year-end, yesterday.
Net profit for the quarter plunged 88% year-on-year (y-o-y) to RM2.36mil from the RM16.4mil garnered in the same period for 2021, as revenue dropped by 40.4% y-o-y to RM171.9mil from RM289mil.
Cumulatively, Luxhem recorded net earnings of RM51.3mil for financial year 2022, which, while not as drastic as the quarterly fall, still represented a 30.8% y-o-y decline from 2021, where it saw a net profit of RM74mil.
This was on the back of a 13.1% y-o-y reduction in turnover to RM802.8mil.
The group attributed the decrease in overall revenue and profits to a slowdown in both metrics for its trading and manufacturing segments.
Although it did not provide further details as to what caused the decline, it may be assumed that the aforementioned exchange rates and raw material factors, present throughout 2022, would have played a significant hand on the company’s performance.
Comparing the final quarter with the three months ended Sept 30 2022, while revenue nudged 1% up quarter-on-quarter from RM170.5mil, net profit nonetheless shrunk by 72% from the RM8.5mil it made for the third quarter.
Due to the relatively less encouraging performance for its final quarter as well as throughout 2022, earnings per share had also slid 37% to 4.27 sen per share for last year, compared to 6.77 sen per share for 2021.
The group said it will continue to improve its own productivity and efficiency this year to face the said external uncontrollable factors and challenges.
Luxchem also declared a single-tier interim dividend of one sen per ordinary share, to be paid on May 12.
