Amtek posts 36% increase in net profit

August 27–AMTEK Engineering has reported a 36% jump in net profit to $43.8 million, buoyed by a recovery in the global economy and gains from disposal of businesses.

The record performance by the precision parts maker was achieved on a 17% jump in turnover to $778.8 million. All four of Amtek’s business lines contributed at least double-digit growth.

For the year ended June 30, turnover from its rubber and plastics business – also the fastest-growing – went up to $40.7 million, from $14.2 million a year ago. Its main business of metal stamping and precision tooling saw turnover rise 12.5 per cent to $428.9 million.

Sales in the enclosure and mechanical assembly segment grew 11.6% to $256.3 million, while cleanroom and machining revenue swelled 27.6 per cent to $38.8 million.

The group also benefited from exceptional gains of $7.1 million, the bulk of which, $6.6 million, was from selling Malaysian unit Kris Components in June. Excluding exceptional gains, net profit rose 13.7% to $36.7 million.

According to group executive chairman Lee Ah Bee, gross profit margins would have been higher if not for the higher cost of raw materials such as steel. Materials and subcontract costs edged up 18% to $476 million.

‘The outlook for raw material prices remains uncertain,’ he said. ‘Nevertheless, we are carefully managing expenses to maintain our profit margin.’

Earnings per share came to 19.38 cents, up from 15.30 cents a year ago. Net asset value per share as at June 30 totalled $1.24, against $1.12 previously. The group has proposed a final dividend of 5.5 cents per share, bringing the full-year dividend to 7.5 cents per share.

In the stock market yesterday, Amtek closed one cent up at $1.15.


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