Tiong Nam’s logistics, warehousing jumps five-times in 4QFY20

Tiong Nam Logistics Holdings Bhd (Tiong Nam) saw profit before tax (PBT) in its core logistics and warehousing services segment jump 400.2 per cent year-on-year (y-o-y) to RM10.8 million in the fourth quarter ended March 31, 2020 (4QFY20), from RM2.2 million last year.

The segment’s improved profitability is 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 Movement Control Order (MCO).

The higher profitability was achieved despite the segment posting marginal revenue decline to RM130.6 million compared to RM134.1 million 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,” managing director Ong Yoong Nyock said.

“Despite logistics and warehousing services segment’s improved performance, we are mindful that now is not the time to be complacent and opine that the logistics sector will remain volatile on both regional and domestic fronts.

“Moving forward, we have since the implementation of the Conditional MCO on May 4, 2020, 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.”

Tiong Nam’s property development segment recorded PBT of RM1.8 million on RM9.1 million revenue in 4QFY20, compared to RM1 million loss before tax (LBT) and RM1.2million revenue previously. This is driven by sales of completed property units at the group’s PineTree Marina Resort.

Furthermore, the group’s hotel and dormitory segment consisting of Fraser Place Puteri Harbour posted LBT of RM5.9 million on RM1.9 million revenue in 4QFY20, from LBT of RM4.3 million on RM1.1 million revenue due to tourism industry being adversely impact from Covid-19 pandemic.

Overall, Tiong Nam narrowed its net loss in 4QFY20 to RM4.3 million from RM10.3 million a year ago, while revenue marginally improved by 3.7 per cent to RM141.6 million from RM136.5 million previously.

For the financial year ended March 31, 2020 (FY20), the group successfully returned to black with a net profit of RM0.7 million from net loss of RM1.4 million last year.

The group also managed to marginally improve its revenue by 2.2 per cent to RM603 million from RM589.9 million previously.

This upturn is primarily driven by the improved financial performance of the logistic and warehousing services and property development segments, which offset the losses incurred by the group’s investments as well as hotel and dormitory division.