CFA Society Singapore
SINGAPORE (Jan 9): Duty Free International (DFI), the duty free and duty paid retail group in Malaysia with more than 40 outlets, reported earnings for 3Q19 ended Nov more than trebled to RM17.1 million ($5.6 million) from RM4.6 million a year ago.
3Q19 revenue rose 19.3% to RM157 million from a year ago mainly due to an increase in demand for certain products and the sales mix. There was also an increase of RM1.0 million in other operating income, attributable to interest and sundry incomes that the group had received.
Profit before income tax more than doubled to RM20.6 million mainly attributable to a higher revenue recorded as well as a net foreign exchange gain of RM1.5 million in 3Q19 compared to a net foreign exchange loss of RM7.5 million in 3Q18.
For 9M19, the group registered slightly lower revenue of RM388.8 million although earnings rose 12.9% mainly due to the net foreign exchange gain of RM6.8 million compared to a net foreign exchange loss of RM13.3 million in 9M18.
The company has declared a second interim dividend of 1 cent per share for 3Q19, which brings dividend per share declared to date to a total of 1.8 cents per share.
Group inventories increased slightly from RM135.4 million in the FY18 ended Feb 2018 to RM177.5 million in 3Q19. This was the result of a consolidation of inventories of the newly acquired Brand Connect Group amounting to RM9.7 million, as well as an overall increase in purchases for 9M2019.
Total borrowings decreased from RM16.4 million as at end Feb 2018 to RM4.0 million as at Nov 30 2018 mainly due to a decrease in trade facilities utilisation of RM12.3 million. The group was in a positive working capital position of RM454.7 million as at end Nov 2018.
At the end of 3Q19, the overall cash and cash equivalents of the group decreased to RM221.6 million compared to RM267.6 million in 3Q18.
In its outlook, DFI expects the operating environment to remain challenging given the current economic outlook and cautious consumer spending. However, the group will continue its efforts to identify new market opportunities and strategies to further strengthen its customer base and distribution channels through a wider product offering. The group says it will also intensify marketing efforts and closely monitor key cost drivers to remain competitive and profitable for the remaining quarters of the FY19 ending February.
Shares in DFI closed 0.7 cent lower at 19.2 cents on Wednesday.