Higher raw material cost a drag on Hup Seng’s earnings


During the quarter in review, the confectionery company’s revenue remained relatively unchanged at RM87.7mil, compared with RM87.8mil previously, while earnings per share (EPS) fell to 1.24 sen from 1.55 sen.

PETALING JAYA: Hup Seng Industries Bhd posts a lower net profit of RM9.9mil for the fourth quarter ended Dec 31,2020, compared with RM12.4mil in the corresponding quarter last year, mainly due to higher cost of certain raw materials.

During the quarter in review, the confectionery company’s revenue remained relatively unchanged at RM87.7mil, compared with RM87.8mil previously, while earnings per share (EPS) fell to 1.24 sen from 1.55 sen.

The company has proposed an interim dividend of two sen per share for the quarter in review.

In a filing with Bursa Malaysia, Hup Seng said despite the Covid-19 resurgence in the fourth quarter of 2020, it was still able to carry on normal operations with sufficient supply to meet the demand for biscuits.

Domestic sales grew 7%, or RM4.2mil, compared to the previous corresponding period from all trade channels. Export markets, on the other hand, decreased 16% or RM4.2mil, notably from Saudi Arabia, Thailand, Indonesia and China.

“The export markets were also affected by the global shortage of shipping containers in Asia and congestion in several ports from November 2020 onwards into year 2021, ” it said.

For the full year, Hup Seng’s net profit increased 3.7% to RM40.4mil from RM38.9mil in 2019, while EPS rose to 5.05 sen from 4.87 sen. Revenue grew 5.8% to RM327.3mil from RM309.5mil.

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