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Quarterly Report For The Financial Period Ended 31 March 2018

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Condensed Consolidated Statement Of Profit or Loss And Other Comprehensive Income For The First Quarter Ended 31 March 2018

Comprehensive Income

Condensed Consolidated Statement Of Financial Position As At 31 March 2018

Financial Position

Performance Review

  1. Current Quarter vs Preceding Year Comparative Quarter

  2. Continuing operations
    For the current quarter, the Group reported a lower profit before tax of RM1.58 million on the back of RM9.16 million in revenue compared with the profit before tax of RM8.61 million and revenue of RM9.77 million in the preceding year comparative quarter.

    Revenue for the bedding operation in Malaysia contracted by 5% due to lower consumer sales. Profit before tax is maintained at the same level as preceding year due to improved gross profit margin. The group's associates contributed lower net profit due to lower profit reported by associates in power business. Higher other income recorded in the preceding year comparative quarter was due to incentives received by the associates in Jiangyin and gain on deregistration of a subsidiary in Hong Kong

    Discontinued operation
    No revenue was recorded for the current quarter as the stainless steel fittings division has ceased production operation at the end of December 2017. It incurred a loss of RM0.72 million from expenditure incurred to complete the business cessation.

  3. Current Period vs Preceding Year Comparative Period

  4. Continuing operations
    For the nine month period ended 31 March 2018, the Group reported a lower profit before tax of RM5.95 million compared with RM12.59 million in the comparative period of the preceding financial year. Revenue contracted by 5% to RM28.09 million whilst gross profit margin improved two percentage point to 37% over the comparative period.

    The bedding operations in Malaysia reported lower revenue and profit before tax mainly due to lower consumer sales. Group's associates in China maintain its profit contribution which mainly derived from power business. Higher other income recorded in the preceding year comparative period is as disclosed in Note B1(a) above.

    Discontinued operation
    For the nine month period ended 31 March 2018, the stainless steel fittings operation recorded a loss of RM4.05 million due to discontinuation of the operation.

Current Year Prospects

The Group expects the performance for the remaining quarters ending 30 June 2018 to be positive.

The bedding division will continue to see strong demand for its products. More effective advertising and promotional activities will be employed to bring more brand awareness and achieve higher sales. Continuous cost control measures will enable a sustainable profit margin.

Group's associates in China are expected to contribute positively to the Group.

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