Duty Free International reports 40% lower 1Q earnings of $3.1 mil on revenue slips

Duty Free International reports 40% lower 1Q earnings of $3.1 mil on revenue slips

By: 
Michelle Zhu
11/07/18, 11:20 pm

SINGAPORE (July 11): Duty Free International (DFI) posted earnings of RM9.05 million ($3.06 million) for the 1Q ended May, down 39.9% from RM15.05 million a year ago on lower revenue, donations and the absence of a gain arising from changes in fair value of option.

Revenue for the quarter fell 28.9% to RM117.4 million from RM161.1 million in 1Q18, largely due to a shortage of supply of certain popular products in the global market.

Meanwhile, operating expenses grew 26.8% to RM7.7 million compared to RM6.1 million a year ago as the group booked donations of RM3 million.

There was also no gain arising from changes in fair value of option in the latest quarter, as compared to RM6 million in 1Q18 due to a call option issued to give Heinemann Asia Pacific (HAP) the option to acquire 15% of additional equity interest in DFZ Capital, a subsidiary of DFI.

As at end-May, cash and cash equivalents grew to RM286.7 million compared to RM255.5 million at end-1Q18.

DFI has declared a first interim dividend of 0.8 cent per share for the latest quarter under review.

Looking ahead, the group expects its operating environment to remain challenging with the volatile US/MYR exchange rate, rising inflation and weak consumer purchasing sentiment.

Nonetheless, it says it will continue to identify new market opportunities while closely monitoring key cost drivers to remain competitive and profitable for the remaining quarters of the financial year.

Shares in DFI closed 2.4% lower at 20 cents on Wednesday.

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