KUALA LUMPUR (Sept 14): Plastic solutions provider cum property developer HIL Industries Bhd’s net profit for the second quarter ended June 30, 2021 (2QFY21) nearly doubled to RM4.28 million from RM2.15 million in the same period last year, boosted by stronger contributions from its manufacturing segment. Revenue was up 16.8% to RM25.59 million from RM21.91 million.

The company's manufacturing division is involved in plastic injection moulding, which produces plastic original equipment manufacturer (OEM) parts, mainly for automotive and IT-related products. The division achieved a revenue of RM17.4 million in 2QFY21, up 34.9% from RM12.9 million in 2QFY20, amid the launch of several new car models and increased sales enjoyed by its customers on the extension of the waiver of sales tax under the Penjana plan, it said in a statement.

Revenue contribution from the property development and management division, on the other hand, contracted 9.9% to RM8.2 million from RM9.1 million, as sales slowed under the various lockdown measures in 2QFY21.

On a quarter-on-quarter (q-o-q) basis, however, HIL Industries recorded a lower net profit, dropping 31.08% from the RM6.21 million it made in 1QFY21, as revenue fell 26.21% from RM34.68 million. This was mainly attributed to the lower profit recognition from its property division, and the implementation of the full movement control order (FMCO) by the government from June 1, 2021.

For the cumulative six months, HIL Industries' net profit rose 66.97% year-on-year to RM10.49 million from RM6.28 million, as strong demand for automotive parts and components in the period under review supported speedier bottomline growth; revenue grew 11.84% to RM60.28 million from RM53.89 million.

The company said its financial position remained robust as at June 30, with cash and cash equivalents at RM135.8 million and a current ratio of 5.3 times, and no bank borrowings.

Going forward, its president/chief executive officer Datuk Milton Ng said HIL Industries will continue to implement various cost containment exercises focusing on productivity improvements, and strive to be proactive in aligning its market strategies to capture the opportunities in both manufacturing and property divisions.

“The FMCO which was imposed by the government has affected our performance for this period. However, we are optimistic that we can recover strongly from this pandemic with the current high vaccination rate as well as the opening up of most business segments, as more states move out from Phase 1 of the MCO.

“Our staff are almost 100% fully vaccinated. Based on the pent-up demand from our customers, we anticipate to rebound strongly subsequent to the end of the MCO and will work tirelessly to recover the lost revenue during the periods of shutdown as a result of the MCO,” he said.

As for the property division, HIL Industries said revenue will be mainly from the Amverton Links as well as its completed project, 108 terrace houses in Bukit Kemuning and Amverton Greens. The company will also launch 100 units of townhouses in 2021 as well as the next phase of terrace houses in Amverton Links.

HIL Industries also said it has inked four joint ventures with landowners to undertake property development projects — subject to shareholders' approval at an upcoming shareholders' meeting.

HIL Industries added it is optimistic that the manufacturing and property divisions will contribute positively to its performance for the remainder of the year, barring any unforeseen circumstances, including new lockdowns.

HIL Industries shares slipped 2.45% or two-and-a-half sen to RM1 today, giving it a market capitalisation of RM332.37 million.