Lii Hen's 4Q net profit rises 33.7% on low raw material prices, stronger US dollar

• “With a largely controllable cost structure in place, a wider market base for the group’s products and rationalisation on the use of available workforce, and barring any unforeseen circumstances, the group will remain profitable for the financial year 2023.”

KUALA LUMPUR (Feb 21): Lii Hen Industries Bhd’s net profit for the fourth quarter ended Dec 31, 2022 (4QFY2022) increased 33.7% to RM16.87 million from RM12.62 million a year earlier on the back of lower raw materials and other operating costs, and stronger US dollar.

Quarterly revenue of the furniture manufacturer fell 31.4% to RM152.43 million from RM222.17 million a year ago, due to sluggish demand for the group’s products, especially for bedroom set, dining and sofa and high level of inventory, the company said in a filing to Bursa Malaysia on Monday (Feb 20).

For the full year (FY2022), Lii Hen’s net profit jumped 98.1% to RM74.83 million from RM37.77 million in the preceding year’s corresponding period, mainly attributed to the relatively lower cost of raw materials consumed compared with FY2021.

Revenue for FY2022, however, fell slightly by 2.5% to RM730.88 million against RM749.27 million previously.

Disruption in the global supply chain and exorbitant shipping charges in the first half of the year, high stock-holding level at customers’ warehouses and reduced demand due to anticipated slowdown in the economy impacted the current year’s export sales volume, the company said.

For the outlook, Lii Hen said reduced orders from customers continue to exert pressure on the group’s operations.

The group said it would continue to exercise vigilance in decision-making to sustain business viability with the view to enhance long-term shareholder value.

“With a largely controllable cost structure in place, a wider market base for the group’s products and rationalisation on the use of available workforce, and barring any unforeseen circumstances, the group will remain profitable for the financial year 2023,” Lii Hen said.