Newly-listed HE Group Bhd’s (HE Group) posted a profit before tax of RM14.8 million for financial year ended 31 December 2023 (FY23), fuelled by Power Distribution System, as well as Other Building Systems and Works segments.
“These segments also contributed most to the revenue of RM204.4 million, at RM133.4 million and RM59.9 million, accounting for 65.3% and 29.3% of the total revenue, respectively,” the group said in a statement today (Feb 23).
This is the second interim financial report announced in compliance with the ACE Market Listing Requirements of Bursa Malaysia Securities Berhad (Bursa Securities).
There are no comparative figures for the preceding corresponding quarter of FY23 as no interim financial report was prepared for the comparative quarter concerned.
The electrical engineering service provider said it 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 its core competencies.
“NIMP prioritises development in key sectors such as electrical & electronics and medical Devices, where a substantial portion of HE Group’s major clients operate.
“This targeted growth within these sectors is expected to generate substantial demand for the group’s Power Distribution Systems solutions, translating to potential for sustained earnings growth in the coming years,” it said.
However, the group saw its profit before tax (PBT) dropped by 28.9% to RM3.4 million for the fourth quarter ended 31 December 2023 (4QFY23).
“This is on the back of lower revenue of RM44.2 million, which is 44% lower than recorded in the preceding financial quarter ended 30 September 2023 (3QFY23) of RM78.9 million.
“The decrease was mainly attributed to the completion of certain projects in 3QFY23,” it said.
During the quarter under review, it said that the Power Distribution System and Electrical Equipment Hook-up and Retrofitting segments, which carry higher profit margins, contributed 70.3% of revenue in 4QFY23 as compared to 59.2% in 3QFY23.
“Hence, PBT margin increased to 7.7% from 6.1% as a result of the favourable project mix,” it added.
The group said it kicked off the new financial year ending 31 December 2024 (FY24) on a good note by securing a contract worth RM34.8 million.
“Its wholly-owned subsidiary, Hexatech Engineering Sdn Bhd had on 30 January 2024, accepted a new work order from a Germany-based manufacturer of semiconductor components.
“The project involves the design, supply, installation, testing and commissioning of low voltage distribution system and is expected to be completed by 30 April 2024,” it said.
HE Group managing director Haw Chee Seng expressed his delight to conclude the year with a strong overall financial performance.
“Looking ahead, we remain confident in our future prospects as we focus on executing the projects in hand and actively participating in tenders to replenish our order book,” said Haw.
The Board of Directors have also 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%. The proposed dividend is subject to shareholders’ approval at the forthcoming Annual General Meeting.
