PETALING JAYA: Wong Engineering Corp Bhd’s net profit slumped by over 90% year-on-year (y-o-y) in the fourth quarter ended Oct 31 after its manufacturing business slipped into losses due to lower sales.
The manufacturer of high precision stamped and turned metal parts told Bursa Malaysia that its earnings declined to RM373,000 as compared to RM3.87mil a year earlier.
However, the group’s overall revenue in the August-October 2020 period rose by 31.34% y-o-y to RM24.67mil as higher progress billing from the construction segment offset lower sales from manufacturing.
“(Manufacturing) revenue decreased by RM2.5mil (down 19%) due to higher inventory build-up sales by customers in the corresponding quarter of the preceding financial year.
“The work progress for the construction project at Kuchai Lama has resumed in early June and has subsequently ramped up to achieve billings of RM13.82mil, an increase of RM8.41mil (up 156%), ” it said.
Earnings per share in the fourth quarter declined to 0.33 sen as compared to 3.41 a year earlier. The group announced a dividend of 0.5 sen per share, which was lower than the one sen payout in the previous corresponding quarter.
Cumulatively, for the financial year of 2020 (FY20), Wong Engineering’s net profit declined by 45.45% y-o-y to RM3.16mil.
This was despite a 16.3% increase in revenue on a year-on-year basis to RM70.85mil.
Moving into FY21, the group said it is cautiously optimistic that its prospects would remain favourable.
Wong Engineering pointed out that it would focus on enhancing its capabilities within core businesses besides pursuing further cost and operational efficiency improvements to maintain competitiveness.