Khong Guan (K03) H1 2023 earnings summary

Executive summary

• HY2023 revenue rose 13.7% YoY to $37.54m; profit attributable to equity holders was $399k versus a $267k loss in HY2022.

• Profit recovery reflected improved Malaysian subsidiary earnings, a $179k fair value gain on short-term investments and higher associate earnings.

Financial highlights

• Revenue was $37.540m versus $33.030m YoY; profit before tax was $886k versus $122k.

• Net profit was $523k versus a $164k loss; attributable profit was $399k versus a $267k loss, and basic/diluted EPS was 1.55 cents versus a 1.03-cent loss.

• Total comprehensive income was $422k versus $153k; foreign-currency translation losses were $107k versus gains of $317k.

• Other expenses increased to $1.271m from $1.146m, mainly due to Malaysia transfer-pricing documentation fees and higher transport and security costs.

Outlook and guidance

• No earnings forecast was given; commodity and associate manufacturing operations remain exposed to raw-material price volatility and weather-related supply changes.

• Malaysian associate manufacturing costs are expected to rise from higher electricity charges under the ICPT mechanism for 1 Jan–30 Jun 2023; competitive freight rates are expected to reduce shipping costs.