Heng Huat’s net earnings shot up 81% to RM26.7m; changing name to HHRG Bhd

ACE Market-listed manufacturer of biomass material and value-added products Heng Huat Resources Group Bhd (HHRG) has concluded its financial year ended March 31, 2023 (FY3/2023) with strong earnings growth as the group recorded its eight consecutive quarters of profit.

At the same time, the company’s shareholders haves also approved the proposed change of its name to HHRG Bhd at an extraordinary general meeting (EGM) held yesterday (May 24).

For its 4Q FY3/2023, HHRG posted a revenue of RM34.26 mil which was 12.23% or RM3.73 mil higher compared to the corresponding quarter a year ago. For the full year FY3/2023, the group saw robust growth with a total revenue of RM155.30 mil which was a remarkable 50.04% or RM51.80 mil jump relative to the previous financial year.

In line with its strong top-line growth, HHRG’s net profit during the quarter under review spiralled 19.44% to RM9.27 mil from RM7.76 mil during the corresponding quarter a year ago. Similarly, the group’s net profit for FY3/2023 jumped by 81.07% to RM26.66 mil in from RM14.73 mil in FY3/2022.

These sales performance enhancements were primarily attributable to the inclusion of a new segment from HHRG’s recently acquired furniture division on March 30, 2022. The group also noted a commendable increase in the sales volume of bio-oil products which improved by circa 13.39% compared to the preceding year.

“This improved company performance was mainly due to increased gross profit alongside enhanced sales performance,” the group pointed up in a media statement.

“However, HHRG also registered higher administrative expenses primarily due to an impairment loss on property, plant and equipment from one of our subsidiaries which was expected to cease operations at the end of the current financial year.”

Moving forward, the group will remain committed to the pursuit of growth to improve its financial performance despite the challenging economic climate.

According to its filing with Bursa Malaysia, HHRG anticipates softened demand for its biomass products and will closely monitor pricing trends.

“In line with this, the group has invested in bio-compost production facilities as a downstream investment, hence allowing HHRG to diversify its portfolio and create additional revenue streams in the upcoming quarters,” it added.

At today’s close, HHRG was up 1 sen or 3.17% to 32.5 sen with 237,600 shares traded, thus valuing the company at RM279 mil. – May 25, 2023

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