KUALA LUMPUR: Newly-listed electrical engineering service provider HE Group Bhd (HGB) registered revenue of RM44.2 million for the fourth quarter (Q4) ended December 31, 2023 (FY23), lower by 44.0 per cent lower from RM78.9 million posted in the third quarter (Q3) FY23.
The decrease was mainly attributed to the completion of certain projects in Q3 FY23. In tandem with reduced total revenue, profit before tax (PBT) also decreased by RM1.4 million or 28.9 per cent to RM3.4 million for Q4 FY23.
This is the second interim financial report announced in compliance with the ACE market listing requirements of Bursa Malaysia.
There are no comparative figures for the preceding corresponding quarter as no interim financial report was prepared for the comparative quarter concerned.
For the quarter, the power distribution system and electrical equipment hook-up and retrofitting segments, which carry higher profit margins, contributed 70.3 per cent of revenue in Q4 FY23 compared to 59.2 per cent in Q3 FY23.
Hence, the PBT margin increased to 7.7 per cent from 6.1 per cent due to the favourable project mix.
For the full year, the company posted a revenue of RM204.4 million in FY23, mainly derived from the power distribution system and other building systems and works segments, contributing to RM133.4 million and RM59.9 million.
These segments accounted for 65.3 per cent and 29.3 per cent of the total revenue, respectively.
Additionally, these segments fuelled profitability, with PBT reaching RM14.8 million for FY23.
The board have proposed a final single-tier dividend of 0.4 sen per ordinary share, amounting to approximately RM1.8 million for FY23.
This translates to a dividend payout of 16.1 per cent. The proposed dividend is subject to shareholders’ approval at the upcoming annual general meeting.
HGB managing director Haw Chee Seng said the company remains confident in its prospects as it focuses on executing the projects and actively participates in tenders to replenish the order book.
HGB kicked off the new financial year ending December 31, 2024 (FY24) on a good note by securing a contract worth RM34.8 million.
Its wholly-owned subsidiary, Hexatech Engineering Sdn Bhd on January 30, 2024, accepted a new work order from a Germany-based manufacturer of semiconductor components.
The project involves designing, supplying, installing, testing and commissioning a low-voltage distribution system and is expected to be completed by April 30, 2024.
HGB sees significant growth potential in the power distribution systems industry, driven by the strategic alignment of the government’s recently launched New Industrial Master Plan 2030 (NIMP) with the company’s core competencies.
The NIMP prioritises development in key sectors such as electrical and electronics and medical devices, where a substantial portion of HGB’s major clients operate.
This targeted growth within these sectors is expected to generate substantial demand for HGB’s power distribution systems solutions, translating to the potential for sustained earnings growth in the coming years.
