KLANG: Total door system solution provider Econframe Berhad, in announcing its fourth quarter (4QFY23) and full year financial results today for the period ended Aug 31, 2023 (FY23), posted top and bottom-line year-on-year (YoY) growth, which culminated in its record-breaking full year performance.
FY23 revenue jumped 27.8% YoY to RM75.9 million from RM59.4 million a year ago. This was primarily driven by its manufacturing segment with strong sales. Econframe’s gross profit margin remained healthy at 32.9% for the financial year under review.
Parallel with the best-ever revenue, the Group’s FY23 profit after tax and noncontrolling interest (PATNCI or net profit) improved 16.2% YoY to an all-time high of RM13.1 million versus RM11.2 million last year. Bottom-line performance was impacted by higher administrative expenses relating to increase in headcount and expenses associated with the recent acquisition.
Econframe Group managing director Lim Chin Horng said, “We are delighted to have delivered successive annual record top and bottomline performance notwithstanding the challenging environment stemming from the global economic uncertainty. Meanwhile, on a quarterly basis, this is the 8th consecutive quarter of revenue growth since 4QFY21, a commendable feat thanks to the team’s collective hard work. Despite the remarkable performance, we are not resting on our laurels and continues to work tirelessly to maintainour growth trend, leveraging both organic and inorganic strategies.”
To recap, Econframe had in September 2023 completed the acquisition of a 65.0%-stake in Lee & Yong Aluminium Sdn Bhd (LYASB) for RM17.2 million, of which RM8.1 million was satisfied in cash with the remaining via issuance of new Econframe shares. LYASB specialises in the fabrication and installation of aluminium glazing, glass products and facade works, which complements the Group’s existing business.
The acquisition comes with a profit guarantee by the vendor that LYASB shall achieve an audited profit after tax (PAT) of not less
than RM4.0 million each year for three years (Aug 31, 2024 to Aug 31, 2026) and a minimum cumulative audited PAT of not less than RM12.0 million (Profit Guarantee).
“The Group is excited by the potential of LYASB as we see strong synergies. Together, we are able to broaden our product offering, expand our geographical presence as well as cross selling our products to our existing customers. On that note, we are pleased to share that LYASB’s sales order has grown strongly since we came into the picture. All in all, the outlook for Econframe is bright premised upon the healthy order book and LYASB’s Profit Guarantee,” Lim said.
For the current quarter under review, the Group reported its best-ever quarterly revenue of RM21.0 million as compared to RM16.3 million in the previous year, a rise of 28.8% YoY. This is the inaugural time Econframe’s quarterly revenue surpassed the RM20-million mark. Meanwhile, the Group also recorded its highest ever quarterly net profit of RM4.1 million for 4QFY23. This represented a YoY growth of 37.2% from RM3.0 million achieved in 4QFY22.