OSK Holdings’ 3Q net profit jumps 76% quarter on quarter

TheEdge Mon, Nov 30, 2020 04:50pm - 3 years View Original


KUALA LUMPUR (Nov 30): OSK Holdings Bhd’s net profit for the third quarter ended Sept 30, 2020 (3QFY20) jumped 75.57% to RM105.21 million, from RM59.92 million in the preceding quarter, as all segments saw improved earnings mainly due to the easing of the movement control order since June 10.

Revenue surged 83.12% to RM319.67 million from RM174.57 million in 2QFY20, the group’s filing to Bursa Malaysia showed.

As with last year, the group did not declare any dividend in this quarter.

OSK said its property segment’s pre-tax profit rose 35% quarter on quarter to RM36.53 million following the resumption of construction at project sites.

Its construction segment posted a pre-tax profit of RM5.14 million as compared with a pre-tax loss of RM3.77 million in 2Q20, as it recorded higher progress billings due to the resumption of construction activities and profit from the finalisation of completed project accounts.

The industries segment also recorded a pre-tax profit of RM310,000 versus a pre-tax loss of RM1.60 million, due to the resumption of production and sales activities at all the factories.

The group’s hospitality segment saw its pre-tax loss narrow to RM4.18 million, from RM8.42 million, due to re-opening of a few of the hotels since July 1, and the cost optimisation exercise implemented to address the impact of Covid-19 on the industry.

The capital financing division’s pre-tax profit, however, slid 0.32% to RM12.47 million, mainly due to lower amount of loans disbursed.

The investment holding division’s pre-tax profit jumped 56% quarter on quarter to RM60.66 million, mainly due to higher profit being recorded by RHB.

On a year-on-year basis, the group’s net profit fell 2.2% from RM107.58 million a year earlier, while revenue slipped 1.25% from RM315.72 million.

The group said although all the businesses showed signs of recovery since the easing of the movement restriction, most of the divisions recorded lower pre-tax profit in 3QFY20 compared with 3QFY19, except the construction segment and capital financing division.

For the nine months ended Sept 30, OSK’s net profit decreased 14.17% to RM241.89 million from RM281.84 million a year ago. Revenue for the period dropped 8.13% to RM749.97 million from RM915.99 million.

Barring unforeseen circumstances, the group expects its performance for 2020 to remain stable with the adoption of prudent financial and business strategies.

“As the economic outlook remains challenging due to the impact of Covid-19 and uncertainties arising from local and global political environment, the group will continue to adopt a cautious approach in chartering the strategies for our various business segments,” it said.

OSK’s share price was up 5 sen or 5.73% at 83 sen as at 4.15pm, valuing the group at RM1.65 billion. 

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