Tiong Nam 4Q net profit up 20.2% on higher contribution from property segment

KUALA LUMPUR (May 25): Tiong Nam Logistics Holdings Bhd saw its net profit rise 20.2% on-year to RM36.96 million or 8.79 sen per share in the fourth quarter ended March 31, 2015 (4QFY15) from RM30.75 million or 7.31 sen per share, mainly on improved revenue from property development.

In a filing with Bursa Malaysia, Tiong Nam also saw its revenue increase 52.86% to RM189.12 million in 4QFY15 compared to RM123.72 million in 4QFY14.

It also recommended a single-tier dividend of 4 sen per share in respect of FY15, subject to shareholders' approval at its forthcoming annual general meeting. Comparatively, it declared a 2.5 sen dividend in the same period last year.

Full year (FY15) net profit was, however, flat at RM74.295 million or 17.66 sen per share compared with RM74.62 million or 17.75 sen per share last year, despite revenue improving by 15.6% to RM616.31 million from RM533.13 million in FY14.

Tiong Nam said the property development segment boasted a 207.3% increase in revenue to RM84.6 million in 4QFY15 compared to RM 27.5 million in 4QFY14.

The company’s core business segment as well as logistics and warehousing services segment also recorded an increase in revenue.

However, the company noted that it recorded pre-tax profit of RM 106.24 million for the current year as compared to the pre-tax profit of RM112.53 million for the preceding year.

“The slight decrease is mainly due to pre-tax profit for the preceding year includes one-off amortisation of deferred income, one-off unquoted subordinated bond interest received, gain on disposal of property, plant and equipment and more prudence approach taken on impairment on receivables as well as higher finance cost for the current year,” the note read.

Tiong Nam said the property development segment is expected to contribute positively to the group in FY16 and therefore, it expects to deliver another year of favourable profit.

Tiong Nam said it will continue seeking new business opportunities, focus on operational efficiency and cost control effectiveness to better contend with competition.

Tiong Nam shares closed 2 sen or 1.49% lower at RM1.32, with a market capitalisation of RM551.44 million.