KUALA LUMPUR: EP Manufacturing Bhd (EPMB) reported a net profit of RM13.32 million for the second quarter (Q2) ended June 30 2023 (FY23), a turnaround from a net loss of RM1.73 million in the same quarter of FY22, underpinned by an RM13.6 million disposal gain from the divestment of the company's properties in Glenmarie, Shah Alam.
Loss before taxation (LBT) from operations for the current quarter was RM0.1 million as compared to profit before taxation (PBT) from operations of RM3.6 million in the preceding quarter, mainly due to decrease in sales and allowances for doubtful debts of RM1.4 million recognized in the current quarter.
Excluding the disposal gain, EPMB reported an RM0.1 million LBT from operations, a 93.8 per cent decline from the RM1.60 million LBT from operations in Q2 FY22.
This improved performance was mainly driven by a 28.1 per cent year-on-year (YoY) rise in revenue to RM137.86 million, up from RM107.63 million a year ago.
Group chief executive officer Ahmad Razlan Mohamed said the company's higher Q2 earnings was due to the increase in sales of automotive parts which resulted from high backlogged orders for new vehicles.
"Our net loss from operations narrowed significantly in Q2 FY23 as compared to Q2 FY22, a strong result despite the allowance we made for doubtful debts on our balance sheet.
"This decision to write down the value of these assets reflects our prudent and conservative approach towards risk management, even as we continue to execute on our transformation plans which includes being a sustainable mobility player," he said in a statement.
The LBT from operations was mainly due to an allowance for doubtful debts, as well as the incurring of additional operational expenditure (OpEx) for the Tanjung Malim plant, ahead of its start-of-production in September.
Q2 FY23 revenue was down 9.4 per cwnt from RM152.12 million in Q1 FY23.
Sales were lower as the Hari Raya holidays resulted in a shortened working period for the current quarter.
