Powerwell Holdings Bhd has been powering on in the past year, surging 55% to close 31 sen on Feb 27. The recent spike in trading volume was after the electrical distribution systems manufacturer reported record quarterly earnings.

On Feb 22, the company posted a near six-fold jump in net profit to RM9.55 million for the three months ended Dec 31, 2023 from RM1.65 million a year ago mainly due to higher gross margin from key projects.

Quarterly revenue climbed nearly 50% year-on-year to RM67.48 million from RM45.03 million, boosted by higher sales from Bangladesh due to project sales from the successful deliveries of the solar power plant, and garment and yarn projects.

The company also declared a second dividend of 1.4 sen per share for the financial year ending March 31, 2024, payable on April 26.

Its revenue in Malaysia in 3QFY24 was lower as compared to the preceding quarter primarily attributable to lower project deliveries. This was mainly from the semiconductor plant project for a multi-national corporation in Kulim Hi-Tech Park, Kedah, as the project is nearing final stages of completion.

Nevertheless, Powerwell operations show resilience as there was a notable uptick in project deliveries for commercial property and data centers projects.

It achieved substantial revenue growth in Bangladesh during the current quarter as compared to the preceding year’s quarter, driven primarily by the successful deliveries of projects, including the solar power plant and the garment and yarn projects.

Meanwhile, its operations in Indonesia recorded lower revenue in the current quarter due to decreased project deliveries for LV sales.

Powerwell also achieved a significant milestone by successfully delivering LV switchboards to a factory in Australia, marking its entry into the Australian market.

The depreciation of the ringgit against major currencies will probably add to its input cost but given that the revenue is likely to grow exponentially, such increase in cost will not be a major issue for the company.