Xin Hwa Q3 net profit slips 8%

PETALING JAYA: Integrated logistics service provider Xin Hwa Holdings Bhd saw its net profit in the third quarter ended Sept 30, 2016 (Q3FY16) decline 8.2% to RM3 million, from RM3.27 million in the previous corresponding quarter, due to higher operating cost and effective tax rate.
Revenue for the quarter up 9.3% year-on-year to RM27.1 million, from RM24.8 million in the same period last year, driven by improved performance from both its land transport operations as well as warehousing and distribution operations.
Looking ahead, its managing director Ng Aik Chuan said in a statement last Friday the group remains positive on its business prospects despite the challenging operating environment.
“Apart from pick-up in cargo transportation activities, we see opportunities in providing logistics solutions for the various government-led infrastructure projects such as the Klang Valley MRT Line 2, LRT Line 3, Rapid Pengerang project, etc.”
“We have proven track record and experience handling logistics for these kinds of projects. Meanwhile, we are also doubling our warehousing space with the construction of new warehouses in Pasir Gudang and Shah Alam respectively. We would have close to one million square feet by end of 2017, up from 404,000 square feet currently,” he added.
For the nine months period, its net profit decreased 30.2% to RM8.45 million, from RM12.1 million last year, while revenue slipped 8.4% to RM75.36 million, against RM82.23 million previously.
“Our performance in the first six-month was affected by the macroeconomic condition as well as lower utilisation of our warehousing space,” Ng said.
“However, we are seeing pick up in trade activities from Q3FY16 which bode well for both our land transport and warehouse businesses. In fact, we have secured new customers for our warehouses and expects the utilisation rate to hit 90% next month, from 70% currently,” he added.