VS Industry records improving performance in 1H23

PETALING JAYA: VS Industry Bhd expects the lingering macroeconomic uncertainties to cast dark clouds over the prospects of its business moving forward.

The electronics manufacturing services provider said the concerns, coupled with the rising cost of living, had also dampened consumer sentiment and spending power.

VS Industry released its second quarter results yesterday for the three months ended Jan 31 (2Q23), with net profit falling 31.8% year-on-year (y-o-y) to RM30.4mil or 0.79 sen earnings per share (EPS) despite revenue rising by 13.1% y-o-y to RM1.15bil.

The group attributed the higher revenue to improved sales orders while profit was dented by higher financing costs and unfavourable exchange rates, as the company raked up a foreign exchange loss of RM19.8mil during the period.

However, things are looking brighter cumulatively for the half-year ended Jan 31, with earnings rising 8.6% y-o-y to RM91.1mil or 2.37 sen EPS from the RM83.9mil net profit or EPS of 2.2 sen it posted for the corresponding period of the previous fiscal year.

This was achieved on the back of a 23.2% y-o-y improvement in turnover to RM2.44bil.

In a filing with Bursa Malaysia yesterday, VS Industry said the improved earnings were mainly attributable to better profitability along with the higher orders from existing key customers, but partially offset by the unfavourable foreign exchange in the quarter.

Its Malaysian business segment posted a 37.4% y-o-y in revenue for the quarter and 49.7% y-o-y growth for the first half of the year due to higher orders from key customers. The group declared a second interim dividend of 0.3 sen per ordinary share yesterday for the financial year ending July 31, which will be paid on April 28.

This resulted in a 13.2% rise in pre-tax profit to RM117.6mil for the Malaysian operations while its China business continued to sustain losses due to the highly challenging environment in the country for the six months ended Jan 31.

The group declared a second interim dividend of 0.3 sen per ordinary share yesterday for the financial year ending July 31, which will be paid on April 28 to shareholders whose names appear on the Company’s Record of Depositors on April 14.

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