D&O net profit surges 119% in 4Q amid higher demand, auto industry recovery
KUALA LUMPUR (Feb 24): D&O Green Technologies Bhd’s net profit surged 119% to RM30.32 million for the fourth quarter ended Dec 31, 2020, from RM13.85 million in the previous year’s corresponding quarter, benefiting from increased demand and recovery in the automotive industry.
The automotive LED maker’s revenue for the quarter grew 39% to RM209.57 million from RM150.47 million a year earlier.
In a filing with the bourse, the group attributed the growth in revenue to its automotive sector, which reported a 41% revenue growth to a record RM206.4 million amid increased demand from commercialisation of new business wins and a general recovery in the automotive industry.
Meanwhile, other net income/expenses swung from a loss of RM3.1 million to a profit of RM900,000 amid higher foreign exchange gain, higher dividend income and lower employee share option scheme (ESOS) expense, partially offset by higher inventory impairment charges.
Finance costs were also lower during the quarter, which contributed to the growth in profit.
For the full year, D&O said its net profit rose 42% to RM49.65 million from RM34.87 million in the preceding year, while revenue climbed 14% to RM575.78 million from RM504.31 million.
Going forward, the group said it is poised to achieve sustainable earnings growth in 2021, given its comprehensive product portfolio and traction gained with Tier 1 automotive customers.
Citing IHS Markit, it said global new light vehicle sales are projected to grow 9% year-on-year in 2021 to 83.4 million units after dipping about 14% in 2020 amid the Covid-19 pandemic.
Sales of electric vehicles are also expected to grow at a compounded annual growth rate of 21.1% to reach 27 million vehicles in 2030.
D&O’s share price fell 21 sen or 5.9% to close at RM3.33 today after rising sharply recently. The group’s market capitalisation stands at RM3.88 billion.