DGB (0152) - DGB Asia confident of returning to profit in FY15 after five years of losses
March 27, 2015 : 10:51 AM MYT
KUALA LUMPUR: DGB Asia Bhd, which saw changes within its top leadership early this year, said it is already seeing results from the new direction and is confident of returning to profit for the current financial year ending September (FY15) after five years of losses.
“We have been working very hard to widen our profit margin, and our first-quarter financial result is evident of our efforts,” managing director Datuk Dr Jacky Pang Chow Huat told The Edge Financial Daily over the phone.
“Moving forward, we are confident that the remaining three financial quarters will be profitable as well,” he added.
The ACE Market-listed automated identification and data capture solutions provider posted a net profit of RM139,000 for the first quarter ended December 2014 (1QFY15) compared with a net loss of RM538,000 a year ago.
DGB Asia’s (fundamental: 1.65; valuation: 0.3) revenue, however, fell 32.5% to RM1.89 million from RM2.8 million in 1QFY14.
“Higher revenue does not necessarily translate into higher profit all the time. For our case, since we took control of the management, we have seen an average of 20% increase in profit margin so far,” said Pang.
Pang joined DGB Asia’s board as executive director in November 2013, and was subsequently redesignated to his current position in February this year.
Notably, Pang is also the founder and managing director of another ACE Market-listed company, Sanichi Technology Bhd (fundamental: 0.9; valuation: 1.2), where he holds a 3.28% equity interest as at Jan 2. As of Sept 30 last year, Pang owned 3.68% of DGB Asia shares.
The group is currently undertaking a renounceable rights issue to raise at least RM6.78 million to a maximum of RM35.52 million.
“The issue price of 11 sen a share for our rights shares is favourable to shareholders, as it represents a 5.93% discount (to the theoretical ex-all price of DGB Asia shares of 11.69 sen based on the five-day volume weighted average market price of DGB Asia shares up to and including March 18 of 14.12 sen), so we hope shareholders will subscribe to it,” Pang said.
He added that the proceeds will be used to expand DGB Asia’s businesses in Thailand and Vietnam.
“Currently, we are doing business through our partners there. With this money, we will be able to reduce our reliance on them, which would increase our margin further,” he explained.
DGB Asia shares rose 13.04% to close at 13 sen yesterday, bringing a market capitalisation of RM21.19 million. Sanichi’s share price climbed 5.26% to 10 sen, with a market cap of RM101.39 million.
http://www.theedgemarkets.com
March 27, 2015 : 10:51 AM MYT
KUALA LUMPUR: DGB Asia Bhd, which saw changes within its top leadership early this year, said it is already seeing results from the new direction and is confident of returning to profit for the current financial year ending September (FY15) after five years of losses.
“We have been working very hard to widen our profit margin, and our first-quarter financial result is evident of our efforts,” managing director Datuk Dr Jacky Pang Chow Huat told The Edge Financial Daily over the phone.
“Moving forward, we are confident that the remaining three financial quarters will be profitable as well,” he added.
The ACE Market-listed automated identification and data capture solutions provider posted a net profit of RM139,000 for the first quarter ended December 2014 (1QFY15) compared with a net loss of RM538,000 a year ago.
DGB Asia’s (fundamental: 1.65; valuation: 0.3) revenue, however, fell 32.5% to RM1.89 million from RM2.8 million in 1QFY14.
“Higher revenue does not necessarily translate into higher profit all the time. For our case, since we took control of the management, we have seen an average of 20% increase in profit margin so far,” said Pang.
Pang joined DGB Asia’s board as executive director in November 2013, and was subsequently redesignated to his current position in February this year.
Notably, Pang is also the founder and managing director of another ACE Market-listed company, Sanichi Technology Bhd (fundamental: 0.9; valuation: 1.2), where he holds a 3.28% equity interest as at Jan 2. As of Sept 30 last year, Pang owned 3.68% of DGB Asia shares.
The group is currently undertaking a renounceable rights issue to raise at least RM6.78 million to a maximum of RM35.52 million.
“The issue price of 11 sen a share for our rights shares is favourable to shareholders, as it represents a 5.93% discount (to the theoretical ex-all price of DGB Asia shares of 11.69 sen based on the five-day volume weighted average market price of DGB Asia shares up to and including March 18 of 14.12 sen), so we hope shareholders will subscribe to it,” Pang said.
He added that the proceeds will be used to expand DGB Asia’s businesses in Thailand and Vietnam.
“Currently, we are doing business through our partners there. With this money, we will be able to reduce our reliance on them, which would increase our margin further,” he explained.
DGB Asia shares rose 13.04% to close at 13 sen yesterday, bringing a market capitalisation of RM21.19 million. Sanichi’s share price climbed 5.26% to 10 sen, with a market cap of RM101.39 million.
http://www.theedgemarkets.com
