KUALA LUMPUR: Impacted by disruptions to its operations and lower customer demand, Daibochi Bhd recorded a 22.7% drop in operating profit for the financial year ended July 31, 2021 (FY21), to RM52.2mil from RM67.5mil previously.
However, profit attributable to owners of the company decreased a marginal 1.3% to RM47mil from RM48mil previously given the applicable tax incentives derived from the group’s ongoing expansion.
Revenue for the financial year was RM602mil, 2.81% lower than in the previous year.In a filing with Bursa Malaysia, Daibochi said the decline in operating profit was mainly due to higher raw material prices and freight costs as well as additional expenses incurred in compliance with the various containment measures.
“Although the country is gradually resuming economic activities under the National Recovery Plan, the fact remains that the operating landscape for the manufacturing sector remains very volatile,” said Daibochi executive director Low Jin Wei in a statement.
He added that the group continues to incur increased expenses in line with the Covid-19 compliance and face higher freight costs and volatility in raw material prices.
However, the group has largely avoided supply chain issues due to its stable and reliable supply of raw materials from Scientex Bhd, a major purchaser of plastic resins.
“We endeavour to assure our clients in the essential food and beverage and fast-moving consumer goods sectors of our ability to reliably produce and deliver flexible plastic packaging products to facilitate customers’ timely go-to market.
“Therefore, we are striving very hard to achieve operational stability and resume our growth path,” Low said.