Teo Seng's 3Q profit rises 11%

by **Cals** Mon 16 Nov 2015, 21:23

Teo Seng's 3Q profit rises 11%

By Kamarul Anwar / theedgemarkets.com | November 16, 2015 : 2:11 PM MYT

KUALA LUMPUR (Nov 16): [size=16]Teo Seng Capital Bhd ([You must be registered and logged in to see this image.] Valuation: 1.50, Fundamental: 1.90)’s net profit for its third quarter ended Sept 30, 2015 (3QFY15) rose 11.27% to RM11.97 million, thanks to better sales of eggs by its foreign subsidiary. Net profit for the previous corresponding period was RM10.76 million.

Its 3QFY15 revenue however, rose at a smaller quantum of 7.12% to RM102.47 million, from RM95.66 million a year earlier.

Although Teo Seng’s 3QFY15 net profit was higher year-on-year, the company halved its declared dividend in the quarter to 2.5 sen a share. The interim single-tier dividend is set to go ex on Nov 27.

For 9MFY15, Teo Seng’s bottom line jumped by 19.86% to RM36.73 million or 12.7 sen a share, on revenue of RM305.67 million. In the previous corresponding period, its net profit was RM30.65 million — or 15.32 sen a share — and revenue was RM272.48 million, denoting a 12.18% top-line rise in 9MFY15.

Teo Seng pointed out that the drop in poultry eggs’ selling prices crimped its poultry farming division, year-to-date.

“Despite the group recording a higher revenue of RM195.6 million (for poultry farming) from the increase in sales quantity of eggs, it recorded a lower pre-tax profit of RM36.3 million for the current period under review was mainly due to lower selling price of eggs,” it said.

As for its invest and trading segment, Teo Seng said, “In line with the improvement in sales of eggs by its foreign subsidiary company for the current period under review, it recorded a slight increase in pre-tax profit of RM8.4 million for the segment.”

On its prospects for the remainder of FY15, Teo Seng said while the weaker ringgit has affected its raw material costs, the lower purchase prices of raw materials in the quarter, outweigh the impact of the weaker currency.

Teo Seng’s counter dropped two sen or 1.17% to RM1.69 at noon break, with 231,500 shares having exchanged hands. Its market capitalisation was RM512.6 million, according to The Edge Research.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)
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