Grand-Flo posts higher Q1 pre-tax profit

Leading tracking solutions provider
Grand-Flo Solution Bhd announced that its pre-tax profit for the first quarter
ended March 31, 2012 increased 6.6 per cent to RM2.440 million from RM2.289
million in the corresponding quarter of last year.

In a statement, Grand-Flo said its revenue recorded a healthy 19.6 per cent
jump to RM20.366 million, propelled by strong tracking solutions sales overseas.

It said while the domestic sales remained the main revenue generator with
RM16.3 million or 80.0 per cent contribution to group revenue, overseas
subsidiaries – mainly in Hong Kong and China – saw revenues increasing to RM3.7
million from RM1.8 million previously.

"We are undoubtedly pleased that our Hong Kong and China operations are
gaining traction this year, securing more Government-related projects. We
believe that by leveraging on this experience and track record, we would be able
to capture more opportunities in this space in future."

Grand-Flo also registered commendable double-digit growth in both its
product segments, with tracking solutions revenues improving 17.9 per cent to
RM13.1 million, and labels segment sales growing 22.8 per cent to RM7.2 million.

It had set a dividend policy to distribute a minimum 20 per cent of group
net profits as dividends to shareholders annually, effective from the financial
year ended Dec 31, 2011.

In line with this newly-adopted dividend policy, Grand-Flo recommended a
final dividend of 1.2 sen per share, comprising a gross dividend of 0.037 sen
per share (less income tax of 25 per cent) and a tax exempted dividend of 1.163
sen per share for 2011.

The proposed final dividend will be tabled for shareholders' approval at its
forthcoming Annual General Meeting, and if approved, the total dividend payout
will be RM1.9 million, or 20 per cent of the group's net profits last year.

Recently, Grand-Flo had also proposed a Bonus Issue of up to 227.4 million
new ordinary shares of RM0.10 par each, on the basis of one bonus share for
every one existing share held on an entitlement date to be determined later.

Upon approvals from the relevant parties, this corporate exercise is slated
for completion by the third quarter of this year. -- Bernama