Tiong Nam’s core logistics, warehousing profit soars

PETALING JAYA: Tiong Nam Logistics Holdings Bhd saw its pre-tax profit for its core logistics and warehousing services segment jump 400.2% year-on-year (yoy) to Rm10.8mil in the fourth quarter ended March 31, 2020 (4Q20) from Rm2.2mil last year.

The company said the segment’s improved profitability was driven by improved utilisation of warehousing services and higher deliveries for essential products, namely food and beverage (F&B) and other consumer goods, as well as medical equipment supplies.

This aided in mitigating the impact of overall decline in regional and domestic business activity stemming from Covid-19 pandemic and MCO, it said.

The higher profitability was achieved despite the segment posting marginal revenue decline to Rm130.6mil compared with Rm134.1mil previously.

For the financial year ended March 31, 2020, the group returned to black with a net profit of Rm0.7mil from a net loss of Rm1.4mil the previous year.

The group also managed to marginally improve its revenue by 2.2% to Rm603mil from Rm589.9mil previously.

“Our integrated business model and diversified warehousing network across Malaysia has placed us in a favourable position to overcome the unprecedented challenges to the logistic industry stemming from Covid-19 containment measures,” said Tiong Nam Logistics managing director Ong Yoong Nyock.

He said that despite the logistics and warehousing services segment’s improved performance, the company was mindful that now was not the time to be complacent.

He said the logistics sector would remain volatile on both regional and domestic fronts.

“Since the implementation of the conditional movement control order on May 4, we saw a surge in customer deliveries from our clientele. Our operations are capable of handling the increase in activity, which would help sustain our performance going forward,” he said.

The group’s property development segment recorded pre-tax profit of Rm1.8mil on Rm9.1mil revenue in 4Q20 and its hotel and dormitory segment posted loss before tax of Rm5.9mil on Rm1.9mil revenue during the same quarter due to the tourism industry being adversely impacted from the Covid-19 pandemic.

Overall, the group narrowed its net loss in 4Q20 to Rm4.3mil from Rm10.3mil a year ago, while revenue marginally improved by 3.7% to Rm141.6mil from Rm136.5mil previously.