Scientex’s 1HFY24 earnings surge 28 per cent y-o-y
KUCHING: Scientex Bhd’s (Scientex) first half of financial year 2024 (1HFY24) core net profit (CNP) has surged by 28 per cent year on year (y-o-y) to RM270.3 million.
According to the research arm of Kenanga Investment Bank Bhd (Kenanga Research), the encouraging double digit growth was largely driven by strong property profits and supported by improving orders and margins from its packaging segment.
Scientex’s 1HFY24 revenue grew by 10 per cent y-o-y to RM2.19 billion as its property division’s revenue surged by 43 per cent y-oy to RM637.2 million, though this was offset slightly by a 6 per cent y-o-y contraction in its Packaging revenue to RM1.37 billion.
The surge in its property division as largely due to steady construction progress across all existing projects, robust demand for its new property launches in Sungai Dua (Penang), Sungai Petani (Kedah), Jasin (Melaka) and Pulai (Johor).
“It garnered a remarkable takeup rate exceeding 90 per cent for its maiden project launch in Ipoh (Perak) in Jan 2024. The development comprises 238 units of double-storey terrace houses, with a gross development value (GDV) amounting to RM62.9 million,” the research arm added.
Meanwhile, the group’s 1HFY24 CNP grew at a wider 28 per cent y-o-y to RM270.3 million thanks to better cost control across both plastic packaging and property segments.
Kenanga Research guided that Scientex has begun seeing a gradual improvement in customer orders from its packaging division in the recent months largely due to increased orders for industrial packaging products which cater to the logistics and shipping sector.
This has caused the group to be able to register a single digit growth in its packaging sales volume in 2QFY24 while utilisation rates trended higher at 55 to 60 per cent, allowing the group to enjoy better economies of scales.
Kenanga Research expects the group’s utilisation rate to move above 60 per cent in the immediate term.
Besides this, the research arm noted that Scientex’s second solar photovoltaic (PV) project at its Klang plant which was completed in 4Q23 has allowed the company to realise about 10 per cent of savings on tis energy costs for both Chemor and Klang plants.
“It remains committed to investing in solar PV systems across its manufacturing plants in Malaysia to mitigate high energy costs and reduce its carbon footprint,” they guided.