FY19 Core Net Profit Grew 15.7% Yoy to RM53.2m, Within Expectations

Poh Huat’s FY19 revenue increased to RM701m, up 12.7% yoy, largely due to better performance from both its Malaysia and Vietnam segments. Contribution from the Malaysia segment increased by 19% yoy due to continuous strong demand for its panel-based bedroom sets from the US market as well as traditional office sets, while the Vietnam segment saw higher contribution by 7.7% yoy attributable to continuous healthy demand for its affordable range of spray-painted bedroom sets. EBITDA margin for FY19 improved by 1ppt to 10.4% on the back of lower raw material cost and reduction in factory overhead cost. After excluding one-off items, Poh Huat’s FY19 core net profit was higher by 15.7% yoy to RM53.2m, which was within our expectation. Also, a final DPS of 2 sen has been declared, bringing FY19 total DPS to 7 sen (FY18 DPS: 6 sen).

Sequentially Stronger as Expected

Poh Huat’s 4QFY19 revenue was seasonally stronger, increasing by 16.5% qoq to RM192.1m on the back of higher sales from both its Malaysia and Vietnam operations. EBITDA margin improved by 1.9 ppt qoq to 11.7% as a result of better manufacturing efficiency from increased production. Sequentially, Poh Huat’s PBT and core net profit grew by 44.1% and 27.3% respectively to RM19.9m and RM15.8m.

Source: Affin Hwang Research - 2 Jan 2020