KUALA LUMPUR (Feb 26): Ann Joo Resources Bhd announced today a 40.5% net profit decline in its fourth quarter ended Dec 31, 2018 (4QFY18) to RM33.02 million from RM55.53 million in the year-ago quarter, due to squeezed margins and the write down of inventories.

The decline in its profitability was in spite of a 10.7% quarterly revenue growth to RM675.73 million from RM610.15 million a year ago, which was helped by higher export tonnage, despite lower selling price depressed by stiff competition in the domestic market.

The group declared a second interim dividend of six sen per share in respect of FY18, payable on May 24.

In its exchange filing, Ann Joo attributed the lower profitability during the quarter to tighter profit margins for its finished products.

There was also a recognition of allowance for inventories written down of RM15.06 million in 4QFY18, mainly derived from the writedown of inventories to net realisable value arising from declined selling prices, it added.

For the full year of FY18, Ann Joo’s net profit was 27.2% lower at RM149.54 million from RM205.38 million in the previous year. Full-year revenue, meanwhile, is up 5.8% to RM2.32 billion, compared with RM2.2 billion in FY17, in line with international trends, and higher export tonnage in 4QFY18.

Ann Joo said its performance for the year ahead will be heavily dependent on the pace of the rectification of the domestic oversupply situation.  

It urges relevant governmental authorities to ensure foreign investments in the country adhere strictly to all their investment conditions, and said the group will continue to actively pursue export opportunities.

Shares in Ann Joo fell seven sen or 4.4% to finish at RM1.52 today, valuing the group at RM818.86 million.