KUALA LUMPUR: Total door system solution provider Econframe Bhd posted a net profit of RM4.1 million for the fourth quarter (Q4) ended August 31, 2023 (FY23), representing a year-on-year (YoY) growth of 37.2 per cent from RM3.0 million achieved in the same quarter of FY22.
Revenue for the quarter stood at RM21.0 million, up by 28.8 per cent compared to RM16.3 million in the same quarter last year.
This marks the first time Econframe's quarterly revenue has exceeded the RM20 million mark.
For the full year, revenue jumped 27.8 per cent YoY to RM75.9 million from RM59.4 million a year ago.
This was primarily driven by its manufacturing segment with strong sales.
Econframe's net profit improved 16.2 per cent YoY to RM13.1 million versus RM11.2 million last year.
Bottom-line performance was impacted by higher administrative expenses relating to increased headcount and expenses associated with the recent acquisition.
Group managing director Lim Chin Horng said the company had posted satisfactory earnings despite the challenging environment stemming from global economic uncertainty.
To recap, Econframe completed the acquisition of a 65 per cent stake in Lee & Yong Aluminium Sdn Bhd (LYAS) for RM17.2 million in September this year.
The deal was satisfied via RM8.1 million in cash, with the remaining via the issuance of new Econframe shares.
LYA specialises in fabricating and installing aluminium glazing, glass products, and facade works that complement Econframe's existing business.
The acquisition comes with a net profit guarantee that LYA shall achieve not less than RM4.0 million annually for three years, from August 31, 2024, to August 31, 2026, and a minimum cumulative net profit of not less than RM12.0 million.
"Econframe is excited by the potential of LYA as we see strong synergies.
We can broaden our product offering, expand our geographical presence, and cross-sell our products to our existing customers.
"On that note, we are pleased to share that LYA's sales order has grown strongly since we came into the picture.
"All in all, the outlook for Econframe is bright, premised upon the healthy order book and LYA's profit guarantee," Lim said.
