Adventa’s Q3 profit down 39.9% on higher import cost

PETALING JAYA: Adventa Bhd saw a 39.97% drop in net profit to RM817,000 for the third quarter ended July 31, 2015 against RM1.36 million in the previous corresponding period, due to higher import cost for healthcare products from the weakening ringgit.
Revenue dropped 6.48% from RM10.09 million to RM9.44 million for the quarter under review.
In a filing with the stock exchange, Adventa said the increased cost could not be fully passed through to the customers as many are still in contract.
“Contracts that are still running will suffer gross margin losses until cost pass through can be achieved. Efforts are made to renegotiate some contracts with some success,” it said.
Adventa also said its subsidiary Sun Healthcare, which is involved in the distribution of medical and healthcare equipment and appliances, has started looking at alternative sources for its supplies as a first response.
Meanwhile, it expects sterilisation provider Electron Beam, to register improved operating margins in the coming quarters.
Nine-month net earnings, meanwhile, dipped 26.24% to RM2.33 million from RM3.16 million on the back of RM31.83 million in revenue compared with RM23.10 million.