KUALA LUMPUR: Engineering solutions provider Kobay Technology Bhd's (KTB) net profit plunged 85.5 per cent to RM1.53 million for the first quarter ended Sept 30, 2023 (1Q24) from RM10.52 million a year ago.
The company said in addition to the subdued demand in the manufacturing segment, changes in product sales mix along with elevated operational cost related to the solar frame and electronic manufacturing services (EMS) projects, affected its earnings.
Revenue fell 18.6 per cent to RM72.76 million from RM89.44 million previously, largely due to weakened market demand, which affected the manufacturing business as well as lower contribution from the property segment following the completion of a project in the financial year 2023 (FY23).
As a result, the company registered lower earnings per share of 0.48 sen for the period against 3.32 sen previously.
Kobay managing director and chief executive officer Datuk Seri Koay Hean Eng said given the demanding conditions, the company will continue to leverage on its solid business fundamentals to weather through the headwinds.
He added that Kobay is committed to staying agile and adaptable in order to continuously refine its strategies and operations.
"For our manufacturing business, we are looking to sustain our current clientele portfolio within the electrical and electronic (E&E) industry.
"We remain optimistic on our strategic customer base diversification by venturing into the renewable energy sector," he said in a separate statement.
At the same time, Koay said the company will continue to undertake a cautious approach on this front in light of the economic climate.
He said the prospect of increased tourist arrivals with the potential to stimulate the property markets in both Langkawi and Penang Island, certainly bodes well for its property division.
Nevertheless, he said Kobay is cognisant of the upheaval of the industry such as elevated building material and borrowing costs.
"Lastly, for the pharmaceutical and healthcare segment, our emphasis will be on expanding both product range and geographical reach while maintaining cost control.
"All in all, the long-term outlook for Kobay remains positive and we are confident to navigate through the challenges ahead, emerging stronger than before," he added
