KUALA LUMPUR (May 18): Technology-related company JCY International Bhd saw its net loss for the second quarter ended March 31, 2022 (2QFY22) narrow to RM14.23 million from RM22.55 million a year ago driven by improved operational yields amid business recovery from the Covid-19 pandemic.

However, the company’s quarterly revenue fell 9.06% to RM224.71 million from RM247.08 million mainly due to a general drop in shipments as a result of weaker market demand.

On a quarter-on-quarter basis, the company sank into the red compared to a net profit of RM6.37 million in 1QFY22 on lower revenue and increase in raw material prices.

Revenue fell 24.37% from RM297.11 million in the immediate preceding quarter.

For the six months ended March 31 (6MFY22), JCY International’s net loss improved to RM7.89 million from RM40.28 million a year earlier. Six-month revenue declined slightly to RM521.82 million from RM523.94 million.

The addressable market for hard disk drive (HDD) shipments experienced a double-digit percentage decline on seasonally lower demand, exacerbated by customer supply chain challenges in China due to Covid-19 lockdowns, economic headwinds from geo-political conflicts, and generally weakening consumer spending affecting HDD demand industry-wide.

Despite this, the company said, nearline capacity demand amounted to 247 exabytes recently, the second highest quarterly shipment ever recorded.

“Indications are that when the global economy improves, the demand for storage capacity will be sustained, and with continuing technical advances HDDs are expected to maintain their cost advantage over alternatives. Operationally, JCY is progressing well in implementing measures to meet future technological requirements and to further build its own development capabilities.

“We continue to automate our production processes to reduce headcount. Effective implementation of these and other cost and quality controls will ensure the competitiveness and future profitability of the group,” JCY International added.

On Wednesday (May 18), JCY International ended the trading day at 24 sen, down by 2.04% or half a sen. This gave the company a market capitalisation of RM500.6 million.

Year to date, the stock has fallen 27.27%.