SINGAPORE (Feb 22): Fu Yu Corporation, the manufacturer of precision plastic parts, posted earnings of $5.6 million in 4Q16, an increase of 44.4% from $3.9 million in 4Q15.

In 4Q16, the group’s revenue softened 3.5% year-on-year to $48.5 million amid slower business conditions. Notwithstanding this, the group achieved higher earnings of the company in 4Q16, driven mainly by a foreign exchange gain versus a foreign exchange loss in 4Q15.

In FY16, the group reported a 10.7% decline in revenue to $198.6 million, reflecting the general slowdown in demand from customers. Sales in China decreased 10.8% to $121.9 million and made up 61.4% of group revenue in FY16. The group also witnessed slower sales from its Singapore and Malaysia segments which registered revenue declines of 13.1% and 7.8% to $39.1 million and $37.6 million respectively in FY16.

Despite lower revenue, the group’s gross profit margin improved to 16.3% in FY16 from 15.9% in FY15. Fu Yu says this was achieved on the back of the group’s consistent efforts to control costs and improve operational efficiencies of its manufacturing facilities. Selling and administrative expenses in FY16 declined 5.4% to $27.9 million from $29.5 million in FY15. As such, FY16 earnings ended 25.1% lower at $10.5 million.

The group is proposing a final tax exempt dividend of 1 cent per share. Together with the interim dividends of 0.5 cents per share, the group’s total dividends for FY16 would be 1.5 cents per share.

Fu Yu says the operating environment is expected to remain difficult as the prevailing uncertainties surrounding the global economic outlook may dampen business sentiment. As such, the group will continue to proactively manage the challenges arising from intensifying competitive landscape, pressure on selling prices and volatility in currency exchange rates.

Shares of Fu Yu closed at 22 cents.