Daibochi posts RM14.6m net profit in 2Q20

by FARA AISYAH/ pic by TMR GRAPHIC

FLEXIBLE packaging manufacturer Daibochi Bhd recorded a new quarterly high in the second quarter ended Jan 31, 2020 (2Q20), with a net profit of RM14.63 million and revenue of RM158.96 million.

Higher sales, improved operating efficiency and newly-acquired subsidiary Mega Printing & Packaging Sdn Bhd contributed to the better financial performance, the group said in a statement yesterday.

The domestic market made up RM87.93 million or 55.31% of the group’s revenue, while exports made up the balance RM71.03 million or 44.69%.

The group in April last year changed its financial year-end from Dec 31 to July 31 to coincide with the financial year-end of its parent, Scientex Bhd.

By leveraging Scientex’s upstream film production capabilities, the company is now focused on its key strengths in the converting space, Daibochi ED Low Jin Wei said.

“We are also working closely with customers on migration to new and innovative printing systems with better efficiency.

“Supported by strong research and development capabilities, coupled with Scientex, we have recently completed rigorous trials with several multinational customers for new sustainable flexible packaging solutions, and are expecting to secure orders to regional markets in the second half of 2020 (2H20),” he said.

For its 1H20, the manufacturer posted earnings of RM25.61 million and revenue of RM311.53 million.

It’s eyeing a stable growth for the rest of the year on resilient domestic and regional sales, and incoming orders for new sustainable packaging solutions by its multinational customers, Low added.

While the group is cautious towards potential developments globally due to the ongoing Covid-19 epidemic, it remains confident on the back of strengthened operations and resilient orders to date.

The acquisition of a 42.4% majority stake in Daibochi by Scientex last year is expected to contribute positively towards Scientex’s earnings for the financial year ending July 31, 2019, onwards.

Scientex’s bid for Daibochi became a conditional mandatory takeover offer after the latter’s shareholders approved the purchase of the majority stake.