Poh Huat 3q Earnings Up 22% As Furniture Orders Shift To Southeast Asia Exporters Amid Trade War
Poh Huat Resources Holdings Bhd saw its third quarter net profit rise 22.5% to MYR11.27 million from MYR9.2 million a year ago, thanks to an increase in shipment of furniture from both its Malaysia and Vietnam operations as the US-China trade war resulted in orders moving from China to Southeast Asia.
Earnings per share for the quarter ended July 31, 2019 rose to 5.09 sen from 4.19 sen previously.
The group has declared a second interim dividend of two sen per share, payable on Nov 14.
In a filing with Bursa Malaysia, Poh Huat said the higher shipment of furniture also contributed to a 13.7% rise in quarterly revenue to MYR164.85 million from MYR145 million a year ago.
For the nine-month period ended July 31, 2019, Poh Huat’s net profit rose 37.3% to MYR36.07 million from MYR26.28 million in the previous corresponding period. Revenue grew 17.7% to MYR508.92 million from MYR432.42 million.
Moving forward, Poh Huat said the protracted trade war has resulted in the shift in the global supply chain and brought about some positive surprises to several countries in the South East Asia region.
“For the global furniture trade, Vietnam is expected to benefit the most, with furniture exports increasing by 30% this year, followed by Malaysia as orders shift to these South East Asian exporters. There are now clear indications of permanent structural changes in the supply chain as more and more manufacturers relocate out of China to this region,” it said.
“As part of the global supply chain, we have registered increased orders for both our Malaysian and Vietnamese operations. We have adapted our production activities to accommodate a wider range of products for our US customers,” said Poh Huat.
Poh Huat’s share price gained one sen or 0.64% to MYR1.57 today, giving the group a market capitalisation of MYR357.59 million.
(The Edge Markets)
