Engtex’s 2Q net profit rose 5.3% to RM14.86m

by **Cals** Fri 22 Aug 2014, 01:28

Business & Markets 2014

Written by Wei Lynn Tang of theedgemalaysia.com

Thursday, 21 August 2014 20:33

KUALA LUMPUR: Engtex Group Bhd’s net profit for the second quarter ended June 30, 2014 (2Q14) rose 5.3% to RM14.86 million from RM14.12 million a year ago, while revenue grew 18.6% to RM331.28 million from RM279.30 million.

For the first six months ended June 30, 2014 (1H14), revenue rose 7.9% to RM591.57 million, which the group attributed to sustained demand of certain metal-related trading products, buoyed by its wholesale and distribution division.

The wholesale and distribution division of pipes, valves, fittings, plumbing and construction materials recorded an 11% growth in revenue to RM370.36 million, contributing 62.6% to the group’s revenue, it said in a filing to Bursa Malaysia today.

But its net profit for 1H14 fell to RM25.31 million from RM28.06 million a year ago while profit before tax (PBT) fell 9.7% to RM36.52 million from RM40.43 million due to price competition for certain manufactured steel products and higher operating cost of its ongoing property development project in Selayang.

On prospects, Engtex said: “The performance of the group will continue to be affected by factors such as the volatility in international and domestic metal prices, and the timely implementation of projects in the construction, utilities and infrastructure and property development sectors.”

Nonetheless, it will continue to focus on expanding its existing product range for its wholesale and distribution division locally and abroad, and will improve and optimise its operating capacity in its manufacturing division.

It also expects the property division to contribute significantly from the completed and ongoing residential and commercial development projects in Selayang.

“The directors remain cautiously optimistic on the performance of the group in the current year which is dependent on the domestic demand and global economic environment,” it said.

Engtex closed 6 sen up or 3.19% higher to RM1.94, giving it a market capitalisation of RM377.87 million.