PETALING JAYA: Magnum Bhd has posted a 22.79% decline in net profit year-on-year (y-o-y) at RM56.29mil for the fourth quarter ended Dec 31,2019 on the back of lower contributions from its gaming division.
This was, however, mitigated by higher income recorded by its investment holding and others division.
Its revenue for the quarter also saw a 12.9% y-o-y decline to RM630.93mil.
Magnum said in a filing with Bursa Malaysia that its gaming sales for the quarter dropped 13% or RM93.9mil to RM630.5mil, mainly due to three lesser draws, coupled with lower 4D Jackpot sales.
This resulted in a lower gaming pre-tax profit of RM74.69mil compared to the RM103.25mil in the corresponding quarter in 2018.
On a full financial year basis, Magnum’s net profit for 2019 more than double that of 2018 or by 126.52% to RM238.73mil.
This was mainly due to the lower losses it suffered in its investment holdings and others division, which dropped from RM39.28mil to RM4.47mil for the year.
The group’s revenue was only 0.05% higher at RM2.71bil.
Magnum said the increase of gaming sales, despite 14 lesser draws, was mainly due to higher sales from the 4D Jackpot game arising from prolonged jackpot runs in the first and second quarters last year and the result of a more sustained enforcement by authorities on illegal operators.
Despite the higher gaming sales, the group said gaming pre-tax profit of RM347.67mil was 1.4% lower than the previous financial year, mainly due to higher prizes payout.
The board declared a fourth interim single-tier dividend of 3 sen per share for the quarter, bringing the total dividend for the financial year to 16 sen per share.
On its prospects, Magnum said the impending proposed implementation of a new stringent law to curb illegal gaming activities is expected to contribute positively to its top line.
It also said that Malaysia’s economic growth is expected to be impacted for the next three months due to the coronavirus disease and this may affect the net disposable income of the players but it is optimistic that the financial impact for 2020 will be minimal with its ongoing rebranding and re-imaging exercise and regular launch of sales campaigns.
Did you find this article insightful?