KUALA LUMPUR (March 7): ACE Market-listed Pekat Group Bhd said it is business as usual for the solar photovoltaic (PV), earthing and lightning protection group although its unit is facing a RM2.2 million lawsuit.
The suit filed against the group’s wholly-owned subsidiary Pekat Solar Sdn Bhd from Multiplex Packaging Sdn Bhd concerns a dispute over the supply and installation of two solar PV systems.
“The company is seeking the necessary legal advice to defend this matter,” the group said in a statement on Tuesday (March 7), adding that the case will not affect the continuation of the group’s projects.
The group said the RM2.2 million claimed by Multiplex Packaging is not expected to have any material impact on its financial performance for the year ending Dec 31, 2023 (FY2023) and as such will not have any impact on its financial standing and commitments.
Multiplex Packaging is claiming RM848,999 in losses suffered for the installation of the solar PV systems, RM849,364 in damages as a result of loss of income, RM508,080 in bank loan interest, as well as general damages to be assessed by the court.
For the fourth quarter of FY2022, Pekat’s net profit slumped 61.8% to RM2.32 million from RM6.07 million a year earlier, dragged by a 20.58% fall in revenue to RM45.03 million from RM56.7 million.
Pekat said the weaker topline was mainly due to the group’s solar PV segment’s lower execution of projects, due to certain project sites not obtaining approvals from the authorities.
Likewise, for FY2022 as a whole, Pekat posted a 20.67% fall in net profit to RM10.04 million from RM12.66 million last year, despite flat revenue of RM179.23 million compared with RM178.53 million previously. The full-year earnings were compressed by higher material prices, administrative expenses and finance costs.
Pekat's substantial shareholders are its executive director Chin Soo Mau with a 34.9% stake, Hextar Holdings Sdn Bhd with 20.16%, executive director and chief executive officer Tai Yee Chee with 10.4% and executive director and chief commercial officer Wee Chek Aik with 8.63%.
It was reported that Hextar Holdings is 64.7%-owned by Datuk Eddie Ong Choo Meng, together with his parents Datuk Ong Soon Ho (23.9%) and Datin Teoh Siew Yoke @ Teoh Siew Chin (11.4%).
Shares of Pekat closed half a sen or 1.08% down at 46 sen, giving the group a market capitalization of RM296.68 million.