By AFIQ AZIZ / Graphic By ANIS SHAMSUL
TIONG Nam Logistics Holdings Bhd’s net profit for its first quarter (1Q) ended June 2019 plummeted 60% to RM1.94 million from RM4.86 million in the previous year’s corresponding quarter amid a challenging property market.
In a filing to Bursa Malaysia yesterday, the logistics and property firm attributed the drop to losses in the property, hotel and dormitory sector.
Group revenue also declined by 3.3% to RM150 million compared to the previous quarter ended June 30, 2018, due to lower contribution from the property development segment.
The property development revenue decreased by 75.5% to RM6.2 million compared to RM25.3 million for the preceding year’s corresponding quarter, it said.
Meanwhile, the logistics and warehousing services segment saw a 9.2% increase to RM141.6 million compared to RM129.7 million in the previous year as a result of new total logistics customers and an increase in business activities with existing customers.
Tiong Nam MD Ong Yoong Nyock said the group’s logistics and warehousing division is expected to continue charting resilient growth in the current financial year ending March 31, 2020.
“This is driven by higher delivery and warehousing sales to our clientele, and increased utilisation of our expanded network in Malaysia and regionally.
“Furthermore, we continued to strengthen our network via the recent commencement of our Savannakhet, Laos, warehouse and sales office in March 2019.
“We are also constructing our new warehouse in Kulim, Kedah, which is targeted to complete in early 2020,” he said in a statement.
Ong said the company is poised to serve the increasing demand for land logistics across various industries, including the burgeoning e-commerce sector, with its comprehensive facilities in Malaysia and the Asean region.
The company is expected to continue seeking out new business opportunities, and remain focused on operational efficiency and cost control amid the competitive environment, he added.
Tiong Nam’s share price was down one sen or 1.94% to close at 50.5 sen yesterday, with a market capitalisation of RM232.69 million.