Swang Chai Chuan (2321) H2 2023 earnings summary

Executive summary

• FY2023 revenue rose 11.5% YoY to RM931.9m; profit attributable to owners increased to RM27.1m from RM26.8m, while basic EPS fell to 2.71 sen from 3.25 sen.

• Net profit margin declined to 2.9% from 3.2%, reflecting lower gross margin; no final dividend was recommended.

Financial highlights

• Gross profit was RM110.3m versus RM111.6m; gross margin declined to 11.8% from 13.4%.

• Profit before tax fell to RM36.7m from RM39.5m; income tax expense declined to RM9.6m from RM12.8m.

• Total comprehensive income rose to RM28.3m from RM26.0m, including other comprehensive income of RM1.2m versus a loss of RM0.8m.

• Selling and distribution expenses increased 10.7% to RM52.8m; administrative and other operating expenses rose 30.9% to RM25.0m.

Outlook and guidance

• Plans to pursue business opportunities and strengthen core capabilities while applying cost controls amid high inflation to support margins and competitiveness.

• Remaining IPO proceeds of HK$74.0m were expected to be used during FY2024; initiatives include a Klang warehouse, strategic investments and distribution, own-product and e-commerce development.