Mattress maker Lee Swee Kiat Group Bhd announced its financial results for the fourth quarter and the full year ended 31 December 2023, the quarter under review, LSK reported a revenue of RM34.21 million, reflecting a slight decrease of 3.2% compared to RM35.35 million in the corresponding quarter of the previous year. However, the profit before tax for the same quarter increased by 33.4%, reaching RM5.20 million, up from RM3.90 million in the previous year’s corresponding quarter. The Group’s profit after tax also experienced an impressive rise, reaching RM4.12 million, translating to a surge of 155.6%.
For FY2023, LSK reported revenue of RM127.7 million. The Group’s PBT and PAT were RM16.89 million and RM13.65 million respectively, which translated to a growth of 12% and 25.9% respectively as compared to the preceding year. The resilient set of financial performance was attributed to better product mix and lower latex price.
The group said the financial performance was influenced by several factors including market conditions, operating activities, and revenue, costs, and profit margin dynamics. While domestic revenue experienced a slight decline in Q4FY23, there was a notable recovery in demand towards the end of the quarter. The export division witnessed a modest increase in sales. The Group maintained satisfactory operating levels, particularly in the mattress division for the domestic market. Sales in the latex division for the export market rebounded due to continued marketing efforts.
Looking ahead, the Group anticipates several factors that may impact its performance in FY2024, including the recovery of demand from overseas markets, fluctuations in key raw material prices, the performance of the Cuckoo Napure mattress collaboration, foreign exchange fluctuations, consumer sentiment and spending habits, the health of the property sector, and potential labor cost revisions.
Commenting on the Group’s financial outlook, Dato’ Eric Lee, managing director of LSK, said: “The resurgence of demand from overseas markets, previously subdued for the past two years, now presents opportunities. As evidenced by the recent uptick in export sales over the past two quarters, accompanied by orders from new customers, we are ready to capitalise on this positive momentum. Furthermore, while we navigate the fluctuations in key raw material prices, notably the centrifuged latex, we are poised to leverage these challenges as catalysts for innovation and operational optimisation. Our collaboration with the Cuckoo Napure mattress division, constituting approximately 20% of our total revenue, offers a robust platform for growth, particularly as we capitalise on the thriving demand through the expansive Cuckoo distribution network,”
“Amidst these factors, including the impact of foreign exchange fluctuations, particularly with the US Dollar, and consumer sentiment influencing spending habits, we are acutely aware of the importance of agility and adaptability in our operations. Furthermore, the health of the property sector directly affects furnishing requirements, and any recovery in the residential property sector would positively impact our performance,”
For FY2023, the Board proposed an interim dividend of 3.5 sen per ordinary share, totaling around RM5.65 million. Additionally, the Board proposed a special interim share dividend by distributing treasury shares at on a basis of 1 for every 25 ordinary shares.
