KUALA LUMPUR: Main Market-listed Cape EMS Bhd
posted record revenue in the second quarter of 2024, but the increase failed to materialise into earnings for the electronics manufacturing services (EMS) provider.
The company's topline climbed to RM166.57mil in 2QFY24 from RM121.78mil in the year-ago quarter, due to a rising demand for its services, bringing its six-month revenue to RM321.05mil, against RM259.13mil in the first half of 2023.
However, the group faced several cost challenges during the quarter that weighed on the bottomline.
These included increased freight expenses due to port congestion, mobilisation costs for its battery pack manufacturing line, installation costs for an energy saving cooling system and provisions in line with prudent accounting practices.
Cape EMS said revenue was also adversely affected by the ringgit strengthening against the US$.
Consequently, the group's net profit in 2QFY24 was RM8.7mil, a sharp decrease from RM15.16mil in 2QFY23, translating into earnings per share of 0.88 sen against 1.64 sen previously.
This brought 1HFY24 net profit to RM22.11mil, down from RM23.66mil in the same period in 2023.
According to the group, its balance sheet remained fundamentally strong with cash and cash equivalents of RM162.2mil, a low net gearing ratio of 0.03 times and net assets per share of 48 sen.
Moving forward, Cape EMS is focused on adapting to unexpected market shifts, even as it benefits from robust demand in the industrial electronics products market, said managing director and group CEO Christina Tee Kim Chin.
"Despite navigating a challenging global landscape characterised by factors beyond our control —including the ongoing US-China trade tensions, global geopolitical conflicts, the Red Sea shipping crisis, and the weakening US$ — we remain vigilant and prudent in managing our operations," she said in a statement announcing the company's quarterly results.
