Xin Hwa Q3 net profit slips 8%

The Sun (Malaysia) - - SUNBIZ -

PE­TAL­ING JAYA: In­te­grated lo­gis­tics ser­vice provider Xin Hwa Hold­ings Bhd saw its net profit in the third quar­ter ended Sept 30, 2016 (Q3FY16) de­cline 8.2% to RM3 mil­lion, from RM3.27 mil­lion in the pre­vi­ous cor­re­spond­ing quar­ter, due to higher op­er­at­ing cost and ef­fec­tive tax rate.

Rev­enue for the quar­ter up 9.3% year-on-year to RM27.1 mil­lion, from RM24.8 mil­lion in the same pe­riod last year, driven by im­proved performance from both its land trans­port op­er­a­tions as well as ware­hous­ing and dis­tri­bu­tion op­er­a­tions.

Look­ing ahead, its man­ag­ing direc­tor Ng Aik Chuan said in a state­ment last Fri­day the group re­mains pos­i­tive on its busi­ness prospects de­spite the chal­leng­ing op­er­at­ing en­vi­ron­ment.

“Apart from pick-up in cargo trans­porta­tion ac­tiv­i­ties, we see op­por­tu­ni­ties in pro­vid­ing lo­gis­tics so­lu­tions for the var­i­ous gov­ern­men­tled in­fra­struc­ture projects such as the Klang Val­ley MRT Line 2, LRT Line 3, Rapid Pengerang project, etc.”

“We have proven track record and ex­pe­ri­ence han­dling lo­gis­tics for th­ese kinds of projects. Mean­while, we are also dou­bling our ware­hous­ing space with the con­struc­tion of new ware­houses in Pasir Gu­dang and Shah Alam re­spec­tively. We would have close to one mil­lion square feet by end of 2017, up from 404,000 square feet cur­rently,” he added.

For the nine months pe­riod, its net profit de­creased 30.2% to RM8.45 mil­lion, from RM12.1 mil­lion last year, while rev­enue slipped 8.4% to RM75.36 mil­lion, against RM82.23 mil­lion pre­vi­ously.

“Our performance in the first six­month was af­fected by the macroe­co­nomic con­di­tion as well as lower util­i­sa­tion of our ware­hous­ing space,” Ng said.

“How­ever, we are see­ing pick up in trade ac­tiv­i­ties from Q3FY16 which bode well for both our land trans­port and ware­house busi­nesses. In fact, we have se­cured new cus­tomers for our ware­houses and ex­pects the util­i­sa­tion rate to hit 90% next month, from 70% cur­rently,” he added.

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