PRG registers 12% fall in 2Q profit on listing expenses

KUALA LUMPUR (Aug 18): PRG Holdings Bhd's net profit in the second quarter ended June 30, 2017 (2QFY17) fell 12.4% to RM1.41 million from RM1.62 million a year ago, due to corporate exercise expenses.

The expenses, it said, is related to the proposed listing of its wholly-owned subsidiary Furniweb Holdings Ltd, which is involved in manufacturing and manufacturing-related business, on the Growth Enterprise Market of the Hong Kong Stock Exchange (HKEX).

PRG had on May 11, 2017 through Shenwan Hongyuan Capital (HK) Ltd, the sole sponsor for the proposed listing, submitted an application to HKEX.

Quarterly revenue, however, rose 77.7% to RM59.05 million from RM33.24 million, mainly contributed by higher revenue and profit recognition from the Picasso Residence development project as well as improved performance of the manufacturing division.

PRG said its manufacturing division posted a profit before tax of RM4 million versus RM2.2 million in 2QFY16; and revenue was also RM6.3 million higher year-on-year at RM29.9 million.

"Increase in revenue for the current quarter [is] mainly due to increased sales volume and product mix. The increase in profit before tax was in tandem with the increase in revenue," the group said.

As for the cumulative six months of FY17 (1HFY17), PRG posted a net profit of RM2.31 million, down 27.7% from the RM3.19 million recorded a year ago.

Revenue in 1HFY17 was 45.4% higher at RM93.41 million compared to RM64.26 million in the same period last year.

Moving forward, PRG group managing director Datuk Lua Choon Hann, in a separate statement, said the group expects the manufacturing division to achieve a satisfactory performance.

As it is also involved in property development and construction, Lua added that the market is expected to remain challenging, so "we will be focusing on the marketing and sale of the Picasso Residence units and working on timely construction of the development for PRG".

PRG shares closed unchanged at RM1.03, valuing it at RM308.39 million. — theedgemarkets.com

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