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- For the property development division, Kobay expects positive performance in FY23, on the back of completion of its maiden Langkawi projects by year-end.
KUALA LUMPUR (Nov 16): Kobay Technology Bhd kick-started its financial year ending June 30, 2023 (FY23) with a 8.18% rise in net profit to RM10.52 million for the first quarter ending Sept 30, 2022 (1QFY23), from RM9.72 million in the same period last year.
This was backed by better performance from its property development and property letting businesses, besides being supported by the pharmaceutical and healthcare division. However, its manufacturing division faced higher pre-operation costs for new businesses.
Earnings per share was up at 3.32 sen from 3.24 sen previously, the engineering solutions provider’s bourse filing on Wednesday (Nov 16) showed.
Quarterly revenue climbed 35.24% to RM89.44 million, from RM66.14 million in the same period a year ago.
Kobay’s manufacturing division reported a revenue growth of 27% year-on-year (y-o-y) to RM57.6 million, driven by demand from the semiconductor and electrical & electronics (E&E) industries.
Its property division saw a nearly three-fold jump, largely arising from construction progress for the current ongoing project, while additional generated rental income benefited its property letting business.
On a quarter-on-quarter (q-o-q) basis, Kobay’s net profit dropped 11.96% from 11.94 million posted in 4QFY22, as revenue fell 6.08% from RM95.23 million recorded in the immediate preceding quarter.
In a separate statement, Kobay’s managing director and CEO Datuk Seri Koay Hean Eng said the group’s manufacturing division enjoyed another good quarter in terms of sales, driven by sustainable demand from the semiconductor, E&E, as well as aerospace industries.
With regard to incurred pre-operating costs, Koay expects some of these new businesses to start operations soon, especially after a successful customer qualification from an electronics manufacturing services client.
At the same time, our property development activities also recovered post-Covid-19 pandemic, while our pharmaceutical and healthcare segment has been delivering consistent results since the acquisition in August 2021. We expect these two segments to continue playing key supporting roles to our group in this new financial year,” he said.
Looking ahead, Kobay is of the view that FY23 will be a challenging year, given operational cost pressures and weaker macroeconomic conditions across the world. The group will continue to adopt a prudent approach in its business operations and diversify its clientele base to incorporate various industries and businesses to mitigate and spread Kobay’s risk in facing these economic challenges.
Due to weaker global growth, Kobay anticipates the manufacturing division growth momentum to be slower compared to FY22.
While maintaining the existing demand from customers in the E&E industry, it noted that the division will further expand clientele exposure into renewable energy-related businesses, rationalising its manufacturing footprint and improving the group’s overall cost structure.
For the property development division, Kobay expects positive performance in FY23, on the back of completion of its maiden Langkawi projects by year-end.
Kobay’s share price settled five sen or 1.78% lower at RM2.76 on Wednesday, giving it a market capitalisation of RM900.3 million.
