KUALA LUMPUR (Feb 27): Homegrown fashion retailer Padini Holdings Bhd said on Tuesday its net profit declined 27.4% in the second quarter from a year earlier due to lower margin and higher staff costs.

Net profit for the three months ended Dec 31, 2023 was RM53.1 million or 8.07 sen per share compared to RM73.14 million or 11.12 sen a year prior, its bourse filing showed. Revenue for the quarter was a tad lower at RM500.11 million versus RM509.48 million as sales fell.

On its outlook, Padini said the retail business will remain challenging due to the deterioration in purchasing power amid rising costs, trade tensions, higher inflation and interest rates.

While the issues related to supply chain, material costs and freight charges seem to have stabilised, “there may still be some further increases in the short term”, Padini flagged.

Padini declared a third interim dividend of 2.5 sen per share, to be paid on March 29, bringing total dividends year-to-date to 7.5 sen per share.

For the first half of FY2024 (1HFY2024), Padini’s net profit shrank 34.62% to RM79.77 million from RM122 million in 1HFY2023. Revenue was barely changed at RM888.3 million against RM888.57 million in the same period a year earlier.

“Management will continue to provide value-for-money products and implement measures to control costs, optimise working capital, preserve cash and streamline the operations to minimise any adverse impacts,” it added.

Shares in Padini closed unchanged at RM3.48 on Tuesday, giving the company a market capitalisation of RM2.29 billion.