SINGAPORE (Feb 27): Memtech International, the global components solution provider, reported a 32% decline in FY18 earnings to US$9.6 million ($12.9 million) from US$14.1 million a year ago.

Despite trade war tensions and a more conservative market sentiment, group revenue increased 13.2% to US$192.5 million for FY18, setting new record for the group.

The group registered growth across key segments including the Automotive segment which surged 18.9% y-o-y to US$94.6 million. Growth within the Automotive segment was driven by major projects with key customers as well as new customer projects going into mass production.

Similarly, topline growth was supported by the Industrial & Medical segment which rose 15% y-o-y to US$13.7 million as new projects entered into mass production.

Further boosting revenue growth was the Consumer Electronics segment which increased 16.5% y-o-y to US$68.2 million. Growth within the Consumer Electronics segment was driven by projects from existing key customers while new projects from a key multinational US customer began to contribute positively to the Group’s financial performance.

While the group’s gross profit increased marginally to US$31.2 million, gross profit margin declined 2.0 percentage points to 16.2% due to several reasons including rising labour and raw material costs, increases in packaging costs, increased costs to meet new environmental standards and lower manufacturing yield during the initial ramp up phase with new customers.

As at Dec 31, the group had cash and cash equivalents of US$22.2 million. After factoring in total borrowings amounting to US$3.5 million, the group’s net cash position stood at US$18.7 million.

The board has recommended a final dividend of 3 cents per share.

Chuang Wen Fu says, “Leveraging on our niche capabilities, we are well placed to secure new projects from both existing and new customers. While continuing to monitor the trade tension situation and global markets closely, we remain cautiously optimistic on our outlook for FY2019.”

Shares in Memtech closed 5 cents higher at $1.03 on Wednesday.