KUALA LUMPUR: Kumpulan Perangsang Selangor Bhd (KPS) sees its revenue growing, but high expenses and impairments leads to a net loss in its latest interim results.
KPS reported a 39 per cent year-on-year (YoY) growth in revenue to RM221.5 million for the second quarter ended June 30 2020 with the recognition of Toyoplas Manufacturing (Malaysia) Sdn Bhd's (Toyoplas) contribution.
However, it said Covid-19 had put a damper on its manufacturing business.
There was a decline in capacity utilisation of its packaging, plastic injection moulding and mattress manufacturing plants.
"With expenses far exceeding the gross profits and lower share of profit from the associates, compounded by RM7.9 million impairment loss which was recognised on investment property and asset held for disposal, the group recorded an operating loss of RM1.6 million.
"Consequently, the group posted a reverse in earnings in the second quarter, registering RM11.4 million loss attributable to the owners of the parent," KPS said in its statement today.
KPS managing director and group chief executive officer Ahmad Fariz Hassan said aside from its asset realignment exercise which resulted in the impairment loss, the second quarter of 2020 was the most challenging period.
It has thrown KPS back in a loss position after a strong show of earnings in the first quarter.
"Although our results were impacted by a precipitous decline in production caused by the Covid-19 pandemic, we have successfully and safely resumed operations at our plants in China, Indonesia, the US and Malaysia after a series of lockdowns due to the MCOs in the respective locations.
"Additionally, we have taken several actions in preparation for recovery by ensuring the sustainability of our supply chain and aiming for sustainable sales traction by creating a more expanded demand."
Ahmad Fariz expects KPS' results for the second half of 2020 to reflect these remedial actions, which will be supported by an improved plant capacity utilisation that is already picking up in the recent months.