KUALA LUMPUR: Notion VTEC Bhd staged a turnaround in the fourth quarter ended Sept 30 with net profit of RM6.74mil from a loss in the third quarter, boosted by its foray into the personal protective equipment (PPE) business.
It reported on Wednesday its revenue was RM69.6mil (Q3: RM40.1mil) and profit after tax of RM6.7mil (loss RM10.9mil) and earnings per share of 1.31 sen (loss per share 2.15 sen).
“The profit in 4Q is mainly attributable to the recovery in revenue across all the segments especially automotive sector with the reopening of key customers' operations from the pandemic lockdown.
“The 4Q represents our maiden entry into the PPE business and the division posted a revenue of RM2.9mil. Overall EMS, posted the highest growth in revenue of 83% over the previous year due to strong demand for consumer products in the E&E segment, ” it said.
When compared with a year ago, the 4Q net profit was down 44.2% at RM6.74mil from the RM12.08mil a year ago. Its revenue was higher by 7% at RM69.57mil compared with RM64.98mil a year ago. Earnings per share were 1.31 sen compared with 2.42 sen.
For the financial year, its net profit was lower by 16.4% to RM6.30mil compared with RM7.54mil a year ago. Its revenue rose slightly to RM242.28mil from RM237.68mil.
To recap, Notion VTec’s four business segments are the design and volume production of high precision metal manufacturing of hard disk drive (HDD), automotive industries’ components and EMS and health care products.
Elaborating on the 4Q results, its HDD parts revenue recorded RM24.1mil (3Q: RM21.7mil), automotive RM21.6mil (RM 9.5mil) whilst engineered products revenue was RM21.1mil (RM8.9mil) and PPE RM2.9mil.
“The healthcare segment is expected to contribute higher in the next financial year when the production capacity of our melt-blown fabric and face mask are fully commissioned, ” it said.
“The EBITA for 4Q was RM12.9mil compared to a loss of RM3.1mil in 3Q (4QFY2019: RM23.4mil). Cumulative year to date FY2020 EBITA was RM41.1mil vs FY19’s RM45.1mil, ” it said.
Notion VTec said it plans to set up nine gloves line for production of nitrile disposable examination gloves in Factory 3 in Meru, Klang.
“On the trading of gloves, we are getting supplies from overseas in quantities of hundred thousands of boxes up to 2 million boxes for selling to ready end buyers. A box is 100 pieces of gloves.
“We rebrand them under the house brand. We will likely be trading NBR (nitrile butadiene rubber) latex once the supply is contracted. Trading contribution is expected to contribute in 1Q FY2021 (Oct to Dec 2020 quarter) onwards, ” it said.
Notion VTec said aside from healthcare, the group continues to expand its aluminium extrusion business to include thin walled tubes to its EMS customer and this business is expected to increase sharply from December this year.
It also made headway in a new business of extruded and machined aluminium parts supply to a contract manufacturer with the end customer, a globally known electric vehicle (EV) maker.
“It is the start of another opportunity to make inroads in the EV segment and will increase about 20% to the EMS segmental revenue.
“FY2021 is expected to perform better than FY2020 due to contributions from the healthcare business and also growth in the HDD and EMS segments with automotive business staying steady.
“In view of the current pandemic and global uncertainties, it is decided by the board to conserve cash as a prudent measure so for this quarter there is no declared dividend, ” it said.
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