Dufu Tech’s net profit slips 5.4% in 2Q20 on commodities losses

Dufu Technology Corp. Bhd’s net profit slipped 5.4% to RM9.9 million in its second quarter ended June 30, 2020 (2Q20) from RM10.46 million a year ago, as pre-tax profit declined 4.4% year-on-year due to an unrealized foreign exchange (commodities) loss of RM3.5 million recorded in the current quarter compared to an unrealized foreign exchange gain of RM1.2 million in the previous year.

Revenue jumped 37.7% to RM73.41 million in 2Q20 from RM53.32 million last year, backed by an increase in volume loading by customers related to hard disk drives (HDD) components.

In an exchange filing yesterday, the industrial products manufacturer also announced a single tier interim dividend of 1.25 sen to be paid on Sept 25, 2020.

It said both its China and Malaysia operations have returned to normalcy following the easing of pandemic containment measures, but the eventual impact will be dependent on the scale and length of the Covid-19 pandemic.

“On top of this, we are concerned with a potential global supply chain disruption risk which may temporarily impact the demand of our own and customer’s product lines,” Dufu Tech said.

Nevertheless, it expects a better second-half of the year outlook for its products in line with current orders in hand. Subsequently, the group is expected to achieve satisfactory results in the financial year ending Dec 31, 2020.

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