This article first appeared in The Edge Financial Daily, on October 26, 2015.

GEORGE TOWN: Garment and packaging manufacturer Magni-Tech Industries Bhd, in which Berjaya Corp Bhd founder Tan Sri Vincent Tan is a major shareholder, expects its double-digit revenue growth streak to continue for the current financial year ending April 30, 2016 (FY16), aided by a weaker ringgit and lower oil and commodity prices.

Its managing director Tan Poay Seng said the favourable tailwinds also mean better earnings ahead for the group.

“We are confident on remaining profitable [in FY16]. It is a continuous effort to drive growth. In our first financial quarter, we did well and we are positive about the second-quarter results,” Tan told The Edge Financial Daily after the group’s annual general meeting last Friday.

“We also expect to see a double-digit growth in revenue in FY16. We are optimistic about it despite the global economic uncertainty,” he said.

The currency profile of the group’s cash and bank balances is primarily in US dollars, yuan and Singapore dollars.

In FY15, Magni-Tech saw its net profit jump 24.2% to RM52.11 million from RM41.95 million in FY14, while revenue grew 10% to RM716.4 million from RM651.27 million. Net profit for its first financial quarter ended July 31, 2015 (1QFY16) grew at a faster rate than its full-year FY15, rising 54.4% to RM15.57 million from RM10.08 million in 1QFY15 on the back of a 9.4% increase in revenue to RM193.82 million from RM177.24 million a year ago due to rises in sales orders in the garment business.

Magni-Tech, which is a major supplier to Nike, also sees itself growing alongside the phenomenal growth of the global sportswear leader, said Tan, but did not elaborate.

According to its annual report for 2015, Magni-Tech said a major customer contributed to more than 10% of the group’s revenue, arising from sales in the garment segment. For 1QFY16, the garment manufacturing segment accounted for about 84.8% of the group’s revenue, while the packaging business contributed the rest.

Meanwhile, Tan said the group, which sits on a net cash pile of about RM100 million, is constantly on the lookout for merger and acquisition opportunities both locally and abroad. “We are in a good position to be sitting on net cash, which is good because we have to meet shareholders’ expectations.

“We will seize the opportunity if there is [a] good investment. We are open to any type of investment. However, we are cautious and will focus on what we do and leverage on the business,” he said.

Tan added that the group is finalising the agreements with its suppliers in light of the Trans-Pacific Partnership (TPP) agreement, which will be favourable to Magni-Tech. “The US is our biggest market and the consumer market there is good for us. So, even though the TPP agreement is unlikely to take effect soon, we are preparing for when it does, perhaps in 2017,” he said.