In the first quarter of 2020, packaging manufacturer Thong Guan Industries Bhd. posted a jump in net profit, supported by higher sales of some of its productions, lower raw material products, and weaker currency.
Net profit jumped to MYR17.46 million (USD4 million), a 36% increase from the same period a year ago.
Revenue was MYR244 million (USD56 million) in the quarter, up from MYR217 million (USD50 million) previously. Pre-tax profit was MYR22.58 million (USD5.2 million).
The company mentioned the rise in profit before tax for its plastic packaging products was supported by the climb in sales volume, more premium products mix, the favorable exchange rate for export sales, and lower raw material price compared to the corresponding period a year ago.
Looking ahead, Thong Guan estimated the sales and production activities for the remainder of the year to be challenged by the uncertainties caused by the coronavirus pandemic. The movement control order and travel restrictions would have a significant impact, the company said.
The company added that the additional capacity it has been planning might be postponed due to the travel restriction. Among the postponed would be the commissioning of an additional premium stretch film line and a new blown film line from Germany.
However, the company is still optimistic about continuing its growth plans for all its business units.
