[NST] Daibochi export sales surge 20.3 pct in 2Q16
15 November 2016
By Zarina Zakariah
KUALA LUMPUR: Leading flexible packaging manufacturer, Daibochi Plastics and Packaging Industry Bhd, saw its export sales surge 20.3 per cent to RM56.7 million in the second quarter ended June 30, 2016 from RM47.2 million a year ago.
Daibochi Managing Director Thomas Lim said that the Group is set to achieve a record turnover in the current financial year ending December 31, 2016, on stronger exports, primarily to existing customers in South East Asia and Australia.
Managing Director of Daibochi Plastic and Packaging Industry Bhd Thomas Lim said Daibochi’s export-based growth strategy has strengthened its position to become a leading flexible consumer packaging manufacturer for major multinational brands.
“We also continue to strive for more export orders throughout the Asia Pacific region. At the same time, we are mindful of the challenges faced with regards to cost and labour shortages in the first half of FY2016.
“We are in the process of implementing measures to improve production and cost efficiency. These include commissioning new machinery, conducting personnel training, and implementing better wastage control to address these issues.”
The Group’s net profit declined 15.5 per cent to RM6.1 million in 2Q16 from RM7.2 million in the previous year due to revised wage policy since January 2016, less favourable product mix, and higher production wastage, among others.
Meanwhile, group revenue in 2Q16 rose 8.2 per cent to RM97 million from RM89.7 million previously driven by higher exports.
For the six month period ended June 30, 2016, the group’s net profit declined 5.9 per cent to RM12.6 million from RM13.4 million last year. Its revenue in the first half 2016 rose 6.2 per cent to RM186.7 million from RM175.8 million previously.
Commenting on prospects, Lim noted that the Government has resumed accepting applications for the recruitment of foreign workers for selected industries, including the manufacturing sector.
“This development, which follows an earlier-announced hiring suspension, will help alleviate labour shortages and provide manufacturers like Daibochi adequate time to strengthen its talent pool.
“We are on track to complete the construction of the second expansion phase of Daibochi Plant 2 in Jasin, Malacca in the fourth quarter of 2016. The expanded built up area of the plant would be utilized for both production and warehousing, providing us with the capacity to capture more business opportunities going forward.
“We also expect to commence operations of a new blown film-making machine in the same plant in end-2016. This will reduce our dependency on externally procured films, leading to lower raw material costs and better production efficiency,” he said.
Daibochi declared a second interim single tier dividend of 1.33 sen per share in respect of FY2016, with estimated payout of RM3.6 million.
The dividend is payable on September 22, 2016, with ex-date of 25 August 2016.
Together with the earlier paid first interim single tier dividend of 1.45 sen per share, total interim dividends in respect of FY2016 amounted to 2.78 sen per share with total payout of RM7.6 million or 60.3 per cent of 1H16 net profit.
The Group has a dividend policy to pay out at least 60 per cent of net profit.
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