KUALA LUMPUR (Aug 21): Focus Lumber Bhd reported a net loss of RM194,000 for the second quarter ended June 30, 2023 (2QFY2023), versus a net profit of RM10.61 million a year earlier, as a result of lower sales and negative sales margin.

The plywood maker said revenue dropped 66.43% to RM13.7 million from RM40.81 million in 2QFY2022, while gross margin on the sale of goods stood at -6% as compared to 40% previously.

“The decline in revenue and sales margin compared to the prior year was primarily due to price deflation related to wood-based commodity markets, combined with lower sales volumes as a result of softening demand for plywood,” the company said in a bourse filing on Monday (Aug 21).

“Cost of goods sold per cubic metre was higher as compared to [the] preceding year’s corresponding quarter due primarily to lower production volume,” it added, noting that production volume declined by 36% year-on-year.

Focus Lumber’s 2QFY2023 net loss was, however, smaller than the RM1.22 million booked in 1QFY2023, while revenue improved 62.7% from RM8.42 million in 1QFY2023.

Going forward, the company sees some sign of increased demand for its plywood, but noted that selling price remains weak.

Overall, Focus Lumber said the company remains cautious with its performance in the remaining period of FY2023, adding that it will continue to manage costs and look for more orders to increase production volume progressively.

Shares in Focus Lumber ended half a sen or 1.03% higher at 49 sen, giving the company a market capitalisation of RM111.75 million.