The building material distributor’s net profit jumps RM38.5m from RM3.6m in 2Q21 fuelled by the increased demand for building material
by JAY SHEILA / pic credit: ANNUAL REPORT
CHIN Hin Group Bhd posted a big jump in its net profit for the second quarter ended June 30, 2022 (2Q22) as the company comes out of the Covid-19 pandemic lockdowns.
The building material distributor’s net profit jumped more than tenfold to RM38.49 million from RM3.62 million in 2Q21 fuelled by the increased demand for building materials as construction activities resumed.
“The past two to three years have witnessed several major global events which have greatly disrupted supply chain continuity and adversely impacted production levels worldwide. As such, all building materials’ unit price index has increased significantly between 4.1% to 19.9%. It has posted great challenges to our manufacturing sector,” the company said in a local exchange filing.
It posted a revenue of RM351.33 million, up 63.45% from RM214.9 million in the corresponding quarter last year.
Its expansion into the property development and construction segment in 2021 brought in revenue of RM12.49 million and RM23.36 million from the vehicle and property development and construction division respectively, the company said.
Chin Hin declared a first interim single-tier dividend of 10 sen per ordinary share amounting to RM8.85 million for the current financial year ending Dec 31, 2022.
Earnings per share in 2Q22 increased sixfold to 4.35 sen from 0.65 sen in 2Q21.
The company said its finance cost for the current quarter went up by RM3.24 million from the previous year principally due to the drawdown of close to RM310 million in bank borrowings during the second half of 2021.
The drawdown was used to part finance the acquisition of Chin Hin Group Property Bhd and Kayangan Kemas Sdn Bhd, refinance the acquisition of Signature International Bhd, defray the working capital for the distribution of building materials and the manufacturing of autoclaved aerated concrete and precast concrete products division.
It was also used to finance the acquisition of a piece of freehold land in Pekan Kinrara, Selangor and five pieces of freehold land in Serendah, Selangor.
The group has further drawdown RM80 million term loan to partly finance the acquisition of Ajiya Bhd and close to RM41.47 million to fund the working capital of the distribution of building materials, manufacturing of ready mixed-concrete, commercial vehicles and construction division in the current quarter.
Chin Hin’s business portfolio encompasses five core divisions: Building materials, property development, construction, home and living, and solar energy.