Priceworth International Bhd’s posted a higher net profit by 196 per cent for financial year ended June 30, 2018 (FY18) to RM13.84 million from RM4.70 million a year ago.
The timber and forestry group said in a Bursa Malaysia filling, the surge in earnings was mainly due to higher other income and the improvement in revenue.
Priceworth’s revenue rose to RM 173.7 million compared to RM 170.1 million in the preceding year.
For the quarter under review, the Sabah based company recorded profit before tax (PBT) of RM 22.6 million as compared to RM 11,000 in the corresponding quarter a year ago.
Income tax expense in the quarter includes adjustment for deferred tax of RM19 million comprising reversal of deferred tax assets of RM9.7 million and additional deferred tax liabilities of RM9.3 million, both of which are non-operational in nature.
“Our results were impacted this quarter due to the ban on export of round logs from Sabah which commenced in June 2018.
“We had previously ramped up and accumulated export-grade logs which we were unable to export this quarter, resulting in demurrage and shipping costs which were beyond our expectations.” said Priceworth International Berhad executive director Richard Koo.
To address this, Priceworth have channelled these logs into their plant for downstream products but there is a lag factor on conversion timing.
He also added that their operations were also affected by some temporary interruptions in July to facilitate the widely reported verifications on major timber players conducted by authorities.
As such, the supply of logs in the market have reduced and the silver lining is that this has elevated the selling prices of round logs, plywood and sawn timber products.
Despite such temporary interruptions, Priceworth have complied with the authorities’ requests as their operations are in accordance to the laws and practices under the Sabah Forest Enactment, 1968.
Sabah Chief Minister’s initiatives has been fully supported by Priceworth International Berhad to transform the timber industry.
“We are confident that our compliant position would eventually be reflected accordingly in the authorities’ findings.” he adds.
Moving into FY19, Priceworth expects its performance to enhance, barring any unforeseen circumstances.