KUALA LUMPUR (May 22): Wah Seong Corp Bhd’s net profit jumped by more than four folds to RM21.76 million in the first quarter ended March 31, 2023 (1QFY2023), from RM4.94 million a year earlier, on the back of a higher revenue contribution from all business segments.

Earnings per share swelled to 2.81 sen from 0.64 sen, the group's bourse filing showed.

This is the strongest quarterly earnings recorded by Wah Seong over the past two years since 4QFY2020, when it posted a net profit of RM37.74 million on a revenue of RM385.95 million.

The higher profit in 1QFY2023 was also attributed to a significantly lower impairment loss on non-financial assets of RM19,000, compared with RM2.83 million a year earlier.

Earnings also rose because of a decrease in selling and distribution expenses to RM7.68 million from RM8.32 million a year earlier, and a decline in administrative and general expenses to RM49.16 million from RM37.08 million.

Meanwhile, quarterly revenue grew 39.41% to RM639.67 million, from RM458.83 million in 1QFY2022.

The group's energy solutions services segment, the group's largest revenue contributor, saw an improvement in both revenue and profitability, on the back of a strong order book.

The segment’s revenue rose 39.9% to RM372.7 million, from RM266.4 million a year ago, while profit before tax (PBT) grew by more than nine folds to RM28 million from RM3 million.

The renewable energy segment also recorded a better performance due to higher number of projects and better profit margin from after-sales services recognised. The segment’s revenue expanded to RM109.7 million from RM90 million in 1QFY2022, while PBT improved to RM11.6 million from RM9.1 million.

The industrial trading and services segment saw revenue rising to RM113.2 million, from RM81.3 million a year earlier, with PBT rising to RM10.2 million from RM4.3 million, thanks to higher sales volume of building materials and recognition of the gain on disposal of asset held for sales.

Wah Seong said its order book stands at RM3.5 billion, and is expected to contribute positive results to the group in the coming years.

Of this, RM3.1 billion is in the energy solutions services segment, another RM426 million in the renewable energy segment, and the remaining of RM54.9 million in the industrial trading and services segment.

Wah Seong's shares closed down 6.5 sen or 7.07% at 85.5 sen on Tuesday (May 23), giving the group a market capitalisation of RM663 million. Year-to-date, the stock has gained 34% from 64 sen on Jan 3.