KUALA LUMPUR (Aug 8): Engineering and manufacturing solutions provider Ge-Shen Corp Bhd (KL:GESHEN) said its net profit for the second quarter doubled to RM4.47 million from RM2.19 million a year earlier, on increased sales revenue from a higher utilisation rate across its factories in Penang, and Hanoi, Vietnam.

The higher earnings were also due to cost optimisation efforts, as well as the de-consolidation of the group's loss-making subsidiary Demand Option Sdn Bhd, Ge-Shen said in a statement.

Earnings per share for the quarter ended June 30, 2024 (2QFY2024) rose to 3.52 sen, from 1.98 sen previously.

Revenue increased to RM75.13 million, up 25% from RM60.08 million in 2QFY2023. This is the highest quarterly revenue recorded by the group since it was listed
20 years ago, said Ge-Shen.

The group did not declare any dividend for the quarter.

For the first half ended June 30, 2024 (1HFY2024), net profit climbed by more than 17 times to RM7.54 million, compared with RM435,000 in the corresponding period of the previous year. Half-year revenue rose 26% to RM148.98 million from RM117.75 million.

Looking ahead, Ge-Shen said it remains “cautiously optimistic” about its performance for 2HFY2024, given its current acquisition and growth plans.

While acknowledging the volatility in the currency market, Ge-Shen said the risk could be mitigated as most of its raw materials are purchased in US dollars and other foreign currencies.

The group also anticipates securing more customers in the electronics manufacturing services and medical devices sectors, which it believes will reposition Ge-Shen as a high-tech manufacturing business with better margins.

Chief executive officer Louis Lau said the group will continue to invest in its existing manufacturing facilities, and expand its production lines to increase output capacity to cater to new clients.

Ge-Shen shares gained 10 sen or 2.69% to close at RM3.82 on Thursday, valuing the group at RM488.3 million.