$TGUAN / 7034 (THONG GUAN INDUSTRIES BERHAD): Q2FY24 Performance Highlights

1. Revenue: The company reported RM303.24 million in revenue, marking a 4.3% year-over-year (YoY) increase but a 12% quarter-over-quarter (QoQ) decrease. The YoY growth was driven by higher sales in the plastic packaging products and F&B and other consumables divisions, while the QoQ decline was primarily due to lower sales volumes in stretch films, industrial bags and films, courier bags, and garbage bags.

2. Plastic Packaging Products: Revenue for this segment reached RM268.19 million, a 2.5% YoY increase, mainly due to higher sales volumes and revenue from industrial bags and films, food wrap, and garbage bags. The segment's profit before tax (PBT) also rose by 3.9%, totaling RM23.56 million.

3. F&B and Other Consumable Products: This segment recorded RM35.05 million in revenue, up 20.3%, primarily due to increased sales of coffee and tea. The PBT for this segment grew by 14%, reaching RM2.48 million.

4. PBT: The company reported a PBT of RM26.04 million, reflecting a 4.8% YoY increase but a 16.6% QoQ decrease. The YoY growth was driven by higher sales volumes in industrial bags and films, food wrap, and garbage bags, while the F&B and other consumables segment’s PBT grew alongside sales. The QoQ decline in PBT was consistent with the decrease in revenue.

5. Net Cash: TGUAN maintained a strong net cash position of RM151.82 million during the quarter.

6. Dividend: The company proposed an interim dividend of 2.5 sen per share for this quarter.

7. Outlook: TGUAN plans to focus on cost reduction, managing operational waste, and improving productivity and efficiency. Additionally, the company will continue to expand its market presence in Europe and the USA with innovative marketing strategies.