TH Heavy falls into the red in 2Q as it recognises foreseeable loss from project delays during MCO

TheEdge Fri, Aug 28, 2020 08:30pm - 3 years View Original


KUALA LUMPUR (Aug 28): TH Heavy Engineering Bhd fell into the red with a net loss of RM15.12 million for the second quarter ended June 30, 2020 (2QFY20) against a net profit of RM4.61 million a year ago, due to the recognition of foreseeable loss amid the delay of projects during the Movement Control Order (MCO) period imposed by the Government, which resulted in additional cost.

The weaker earnings came despite revenue improving by 30% to RM15.56 million from RM11.94 million previously. In a bourse filing, the group attributed the growth in revenue to higher fabrication activities during the quarter.

Among the group’s business segments during 2QFY20, only the construction services registered positive profit contribution, while the offshore crane works segment and the holding company and others segment posted losses.

For the first half of its financial year, net loss totalled RM12.62 million versus a net profit of RM7.1 million a year earlier, though revenue grew 47% to RM34.5 million from RM23.47 million.

“With the partial lifting of the MCO in May 2020, the country’s economic activity is expected to gradually recover and improve, supported by the sizeable fiscal and monetary measures provided by the Government.

“Moving forward, the group will continue to strive hard to pursue business in the domestic and overseas market, where circumstances permit. In addition, the group will continue to seek and explore potential opportunities for acquisitions and collaborations in order to enhance our profitability,” said the group on its prospects.

TH Heavy shares rose 0.5 sen or 3.85% to close at 13.5 sen today, giving the group a market capitalisation of RM151.41 million.

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