$HARISON / 5008 (HARRISONS HOLDINGS (MALAYSIA) BERHAD): Lower Profits in Q3FY2023

1. Revenue: RM559.26 million reflects a 3.71% year-on-year upswing due to increased cement sales in the Building Materials Division. YTD, revenue stands at RM1.75 billion, marking a 5.64% increase, primarily propelled by escalated cement sales due to heightened demand and raised selling prices.

2. Gross Profit: Totals RM64.99 million, a 1.6% year-on-year decline, yet represents a 5.15% year-to-date increase, amounting to RM195.82 million.

3. PBT: Yields RM20.49 million, a 10.8% year-on-year dip attributed to slightly decreased gross margins, escalated selling and distribution costs, and increased interest expenses due to a higher OPR. YTD PBT records RM68.82 million, an 8.17% increase owing to higher sales from price hikes, reduced costs, and lower impairment allowances.

4. Segmental Performance: Trading and Distribution (T&D) segment contributes 97.7% of total revenue, followed by retailing (1.67%) and shipping and other segments (0.63%). The T&D segment sees a 5.63% year-on-year revenue increase due to boosted sales in key product categories but experiences a 15.21% decrease in Industrial and Agriculture Chemicals sales. Retailing sees a 17.57% rise in revenue attributed to increased Famous Amos cookie sales. The Shipping and other segment reports a 16.31% revenue decline due to reduced shipping activities.

5. Balance Sheet: Maintains a net cash position of RM17.45 million, with RM128.89 million in cash and RM111.44 million in borrowings.

6. Outlook: Foresees favorable performance aligned with Malaysia's 4%-5% GDP growth. A focus on leveraging their extensive network and skilled workforce, implementing an ERP system in Sabah for improved efficiency, and vigilantly monitoring operational costs.