HEXTAR (5151) HEXTAR GLOBAL BERHAD's 4Q net profit up 48%, proposes 3-for-5 bonus issue
KUALA LUMPUR (Feb 22): Hextar Global Bhd's net profit grew 48.17% to RM11.51 million in the fourth quarter (4Q) ended Dec 31, 2020, from RM7.77 million a year earlier on the back of a strong performance by its agrochemical segment.
Earnings per share increased to 1.4 sen from 0.95 sen, the agrochemical group said in a stock exchange filing.
Quarterly revenue rose 21.74% to RM100.76 million from RM82.77 million previously.
The group declared a fourth interim dividend of 0.8 sen per share, to be paid on March 26, for a total dividend payout of four sen for the financial year. This represents a 73.5% payout ratio of the year's earnings.
For the full year, Hextar Global's net profit skyrocketed to RM44.54 million from RM2.42 million in the previous year, while revenue climbed 23.82% to RM417.61 million from RM337.28 million due to operational efficiencies and economies of scale achieved from the enlarged group following the acquisition that took place in 2Q of 2019.
"During the current quarter, Hextar reversed a provision for doubtful debts made under MFRS 9 amounting to RM1.5 million due to improved debt collections which consequently led to a better net profit margin of 11.4% from 9.4%.
"On the financial position, Hextar's gearing ratio improved to 0.27 as at Dec 31, 2020 backed by net assets of 25 sen per share," said the group.
Hextar Global also announced a bonus issue of up to 492.4 million new shares on the basis of three new shares for every five existing shares.
The group said the entitlement date of the bonus shares would be determined later, but expects to complete the exercise by the 2Q of 2021.
Hextar Global said the bonus issue will encourage greater participation by investors and potentially broaden the shareholder base.
On the current year outlook, group executive director Datuk Eddie Ong Choo Meng said he remains positive about the overall business prospects.
He said the agriculture segment will maintain its growing momentum and the group expects positive contributions from its newly acquired biogas business.
"We have been awarded two contracts amounting to approximately RM17 million since the acquisition and are still actively tendering for businesses," he added.
Hextar Global shares were 12 sen or 9.84% lower at RM1.10 in afternoon trading, valuing the group at RM910.95 million. The counter saw some 19.7 million shares traded.