KUALA LUMPUR (Dec 2): Shares in Johor-based logistics provider Xin Hwa Holdings Bhd (KL:XINHWA) fell to their lowest on Monday, despite announcing that its cargo transport unit's goods transport licence suspension is set to be lifted a month ahead of schedule.
The stock slipped 3.03% to 16 sen in early trade — the lowest since it was listed on the Main Market of Bursa Malaysia in June 2015 — before paring losses to close at 16.5 sen.
Trading volume totalled 42,000 shares, significantly lower than its 200-day moving average of more than 200,000 shares. At 16.5 sen, the stock was valued at RM40.98 million.
Xin Hwa’s share price has declined 34% year to date, which was further accelerated last month when the Johor Bahru Land Public Transport Agency (Apad) suspended the operating licence of its unit, Xin Hwa Trading & Transport Sdn Bhd (XHTT), due to its failure to meet safety standards.
The company had previously warned that the three-month suspension is expected to impact about 4% to 5% of the group's annual revenue, with losses estimated at around 21%.
However, Xin Hwa said that Apad, in its notice last Friday, agreed to end the suspension earlier on Jan 12, 2025, instead of Feb 10, 2025, following the company’s appeal, according to its filing on Monday.
“Upon the end of the suspension period, XHTT can continue its operations as usual using the vehicles licensed under its goods vehicle operator licence,” it said.
Since the suspension on Nov 13, the company said that relevant rectification actions had been implemented to ensure the continuity of XHTT’s daily operations and minimise losses to the utmost.
“Vehicles registered under other subsidiaries had been arranged to fulfill the urgent deliveries of XHTT and some of the services were outsourced to competent third-party transporters,” it explained.
Moving forward, the company said it will continue its operations with renewed dedication and focus on its business missions.
Last Tuesday, Xin Hwa narrowed its net loss for the three months ended Sept 30, 2024 (2QFY2025) to RM1.83 million versus RM3.35 million in the same period a year ago, thanks to improved sales, lower operating expenses, and the disposal gain of property, plant, and equipment.
Revenue for the quarter rose 36.15% to RM43.22 million, compared with RM31.74 million, mainly driven by the land transport operation and warehouse and distributions.
For the first half ended Sept 30, 2024 (1HFY2025), net loss narrowed to RM1.08 million from RM7.27 million last year, as revenue grew 11.25% to RM76.51 million against RM68.77 million.
Separately, a filing with Bursa Malaysia on Monday showed that managing director Ng Aik Chuan had sold three million or about 1.17% of his stake last Thursday at 16.5 sen, bringing his stake (indirect and direct) to 57.12%.