LKL International records RM859,000 deficit in Q1

PETALING JAYA: Medical/healthcare beds, peripherals and accessories provider LKL International Bhd swung to a net loss of RM859,000 for the first quarter ended July 31, 2017 against a net profit of RM1.63 million in the previous corresponding period, due to lower gross profit margin and contribution from manufacturing and trading activities.
Revenue for the quarter under review also declined 59.5% from RM11.92 million to RM4.83 million.
In a filing with the stock exchange the group said that it is mindful of the challenges in the current financial year as lower investments in the healthcare sector and the increase in raw material costs may affect demand in the short term.
“That said, the group’s venture into distribution of medical devices in the current financial year represents its strategic efforts to diversify its revenue stream within the healthcare sector to cater to evolving market requirements, and offer higher value products to enhance its product portfolios.”
Overall, LKL remains optimistic of its future performance, in view of the increasing ageing population size, low hospital bed-to-population ratio, and necessary investment into healthcare infrastructure and services in tandem with technological advancements.
Meanwhile, the group said in a statement that there has been an uptick in enquiry and sales of medical beds, peripherals, and accessories over the past few months, which will contribute positively to its current financial year ending April 30, 2018 (FY18).
“Furthermore, we expect to benefit from improved efficiency and lower wastage in our manufacturing operations, once the new factory and machine comes online in Q2’18. The greater automation and reduced labour dependency would allow us to mitigate cost escalations and strengthen our competitiveness in the international arena,” said its managing director Lim Kon Lian.
LKL has been distributing Nihon Kohden medical devices since June 2017, through its 70%-owned joint venture company TMI Medik Group Sdn Bhd (TMG).
Going forward, Lim said the group will continue to identify and partner with leading brands to strengthen their medical device distribution business.
Meanwhile, LKL’s new factory in Seri Kembangan, acquired in April 2017, is on track to commence operations in the second quarter ending Oct 31, 2018.