Growth from manufacturing segment to sustain earnings for Kobay Technology

Growth from manufacturing segment to sustain earnings for Kobay Technology

Kobay Technology Bhd foresees growth trajectory to sustain given the heightened foreign and domestic investment interests in local semiconductor and E&E sectors.

KUALA LUMPUR: Engineering solutions provider Kobay Technology Bhd (KTB) posted revenue of RM66.1 million year-on-year (YoY) for the first quarter (Q1) ended 30 September 2021 (FY22), an increase of 69.1 per cent from RM39.1 million recorded in the same quarter last year.

Net profit for the quarter was RM9.72 million compared to RM5.23 million posted previously, an increase of 85.9 per cent.

On a quarter-on-quarter (QoQ) basis, revenue in Q1 FY22 improved by 41.2 per cent while net profit rose 13.96 per cent.

The earnings improvement in the top and bottom lines were mainly attributed to the manufacturing division as demand from semiconductor and electrical and electronics (E&E) surged.

Meanwhile, the returns from its pharmaceutical and health products business also contributed to the quarter.

The newly added business lifted the segment's revenue from RM0.6 million in Q1 FY21 to RM17.7 million in the current quarter.

Chief executive officer and managing director Datuk Seri Koay Hean Eng said given the challenging operating environment caused by the full movement control order, the positive earnings were the epitome of the company's resilience and strength.

"Moreover, we are also happy to witness returns from the healthcare business we recently ventured into.

"Orders from semiconductor and E&E customers will remain elevated due to the robust global demand.

"Furthermore, we foresee that the growth trajectory will sustain for years to come, especially given the heightened foreign and domestic investment interests in our local semiconductor and E&E sectors lately," he said in a statement today.

On 5 November 2021, KTB announced a private placement exercise involving the issuance of 30.6 million shares, which represents up to 10 per cent of the total the number of issued shares in the company.

The exercise is expected to raise gross proceeds of around RM150 million, with RM60 million allocated to set up new manufacturing facilities to produce solar panel frames.

"Besides growth from existing businesses, we are also expanding our product offerings to include solar panel frames under our manufacturing arm.

"With proceeds from the fund-raising exercise, we are expediting our efforts to get the new manufacturing plant ready with production targeted to commence by the first quarter of 2022.

"Under the first phase, the plant will be able to produce an annual capacity of 20,000 metric tonnes of products," Koay said.

https://www.nst.com.my/business/2021/11/748779/growth-manufacturing-segment-sustain-earnings-kobay-technology