PRECISION plastic components manufacturer Fu Yu Corp : F13 0% posted a net profit of S$5,200 for the first quarter of its 2024 fiscal year ended March, reversing a net loss of S$2.4 million in the same period last year.
Revenue in the quarter more than doubled to S$78.9 million from S$36 million last year, due to higher contributions from Fu Yu Supply Chain Solutions.
The supply chain services management arm recorded a revenue rise to S$53.6 million, more than five times higher compared to S$9.7 million a year ago.
However, revenue from the group’s manufacturing business slipped 4 per cent to S$25.3 million from S$26.3 million a year earlier, mainly due to lower sales volume for its networking and communications, as well as printing and imaging segments.
This was partially offset by higher contribution from the consumer segment, which grew 31 per cent to S$11.4 million on the back of higher order volumes from existing customers.
Gross profit for the quarter rose 15.3 per cent year on year to S$4.1 million, from S$3.6 million last year, mainly due to the higher top line.
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The change in revenue mix, combined with higher operating costs, resulted in an overall gross profit margin of 5.3 per cent, compared to 10 per cent a year ago.
While the supply chain management arm recorded a net profit of S$0.4 million, overall net profit stood at S$5,200 mainly due to a net loss at its manufacturing business.
Shareholders’ equity as at Mar 31 stood at S$137.6 million, equivalent to a net asset value of 18.1 cents per share, which includes net cash of around 7.7 cents per share, or S$58.7 million.
Fu Yu said the recent memorandum of understanding to be the exclusive plastics supplier for a Singapore-based medical device manufacturer, as well as new projects secured for its core manufacturing division are in line with its ongoing transformation.
The group is seeking to move up the value chain in the biomedical sector and with a focus on core tooling with higher precision. In line with this transformation, it has commenced the construction of new medical-grade cleanrooms within its facilities in Singapore and Zhuhai, China.
David Seow, group chief executive officer of Fu Yu, said these project wins reflect the early fruits of the company’s strategic transformation.
“The group is leveraging its diversified global supply chain to manage headwinds such as delayed shipment times and higher logistics costs due to the situation in the Middle East, ongoing US-China tensions, changes in the global supply chain, and rising labour and energy costs.
“Moving forward, we will focus our efforts on expanding our project pipeline, and executing our strategic initiatives to further our growth in the coming year.”
Shares of Fu Yu closed flat at S$0.13 on Thursday.