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Friday, February 24, 2017

CCM Duopharma's 4Q earnings down 35%, pays 4 sen dividend


By Adela Megan Willy / theedgemarkets.com | February 24, 2017 : 6:19 PM MYT

KUALA LUMPUR (Feb 24): CCM Duopharma Biotech Bhd's net profit for the fourth quarter ended Dec 31, 2016 (4QFY16) fell 35.3% to RM9.93 million, from RM15.34 million a year earlier.

Revenue dropped 17.2% to RM74.03 million from RM89.40 million in 4QFY15, the pharmaceutical group said in a filing to Bursa Malaysia.

For the full financial year, CCM posted net profit of RM27.81 million, down 22.1% from RM35.70 million in FY15. The group attributed the decline to changes in product mix and increase in production costs due to foreign exchange (forex), which in turn resulted in lower gross margin.

Revenue rose 16% to RM312.94 million from RM269.79 million in FY15, boosted by full-year contributions from recently acquired subsidiaries compared to seven-month contribution in FY15.

CCM announced a final single tier dividend of 4 sen per share for FY16, which will be paid on June 23, 2017.

CCM expects demand in the pharmaceutical industry to remain stable although it noted that business momentum will continue being pressured by the weak ringgit.

"Demand in pharmaceutical industry is expected to remain stable for [the] current financial year, despite business momentum facing increasing challenges arising from weakened ringgit, which affects our production and operational costs," it said.

Additionally, persistent forex volatility and uncertainties in the economy may further put pressure on its manufacturing margins, the group said.

"In view of [the] current challenging environment and barring further unforeseen development, the group is cautiously optimistic to achieve a satisfactory performance for [FY17]," it added.

CCM's share price closed 0.5% lower at RM2.23 for a market capitalisation of RM622.08 million.

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