PLYWOOD products manufacturer Annum Bhd (formerly Cymao Holdings Bhd) has staged a turnaround in its 3Q FY2021 ended Sept 30, 2021 with a net profit of RM27.97 mil against a net loss of RM939,000 in the corresponding quarter a year ago.
Boosted by a surge in sales of plywood and polyester plywood, the company’s revenue spiralled by more than eight times to RM80.67 mil from RM10.02 mil during the same financial period under review
This significantly improved Annum’s pre-tax profit for the current quarter, complemented by a successful restructuring strategy by its management to reduce administrative, selling and distribution expenses.
For the cumulative nine-month period, Annum made a stellar return to the black with a net profit of RM43.81 mil on the back of a significant jump in revenue to RM167.16 mil.
In comparison, the group was loss-making during the same financial period a year ago with a net loss of RM5.4 mil from a revenue of only RM29.44 mil.
Annum attributed its sharp improvement in its revenue and profit to the various measures to restructure its business strategies by reducing its administrative costs to mitigate the impact of COVID-19 pandemic on the company’s financial performance.
“We are optimistic that the continuation of a more agile administration as well as a robust recovery for the construction sector will help to boost our earnings going forward,” the company pointed out in a statement.
Upon its successful diversification into the construction sector, Annum has begun participating in a few construction projects to improve the company’s earnings.
This is in line with a robust outlook for the sector as outlined in the 12th Malaysia Plan (12MP) and the recently announced Budget 2022.
The 12MP which boasts a development expenditure of RM400 bil – the largest in Malaysia’s history – over the next five years has placed emphasis on basic infrastructure such as roads, water and electricity, and an internet connection, especially in rural areas.
The Budget 2022 has set aside RM75.6 bil for development expenditure with focus on national infrastructure development projects worth RM3.5 bil which includes the construction of the Pan Borneo Highway and Central Spine Road.
“Given the robust outlook for the construction sector and our expertise in the construction space, we are confident that this will drive earnings for Annum going forward with the emphasis being placed on the infrastructure-related projects,” added the company.
At the close of yesterday’s trading (Nov 18), Annum was down 0.5 sen or 0.52% to 95.5 sen with 1 million shares traded, thus valuing the company at RM72 mil. – Nov 19, 2021
