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Tuesday, February 23, 2016

Tien Wah's 4Q net profit jumps 14.1%, plans 14 sen dividend

Kuala Lumpur (Feb 22): Tien Wah Press Holdings Bhd's net profit jumped 14.1% to RM11.8 million in the fourth quarter ended Dec 31, 2015 (4QFY15) from RM7.82 million a year earlier, boosted by RM2.1 million gain on disposal of 50% of Toyo (Viet) Paper Product Co. Ltd, sales rebate of RM3.9 million in 2014 and improvement in operating margins, favourable foreign currency exchange rate and lower depreciation charge.

The lower depreciation charge in the current quarter was RM1.5 million as the group had assessed and revised the residual useful life of certain plant and machineries to reflect its longer estimated useful life based on past experiences and machine vendor's validation.

Quarterly revenue grew by 11.9% to RM97.1 million from RM86.8 million in 4QFY14.

Tien Wah recommended a final single tier dividend of 14 sen, subject to shareholders' approval at the forthcoming annual general meeting. The payment date is June 30, 2016.

Tien Wah's full year (FY15) net profit more than doubled to RM33.8 million from RM13.5 million in the previous year while revenue was only up 3.87% at RM367.4 million from RM353.7 million in FY14.

In its filing to Bursa Malaysia, the management said that Tien Wah had completed its strategic restructuring of the production footprint within the group last year to service the customers and reduce operating cost, which incurred a total redundancy cost of RM6.7 million.

The group expects the outlook for 2016 to remain challenging with the current volatile global environment.

"Besides efficiency improvement, wastage control and active cost containments, the group continues to develop new opportunities which could lead to volume growth in new customers and geographical segments," the management said in a filing to Bursa.

As at closing today, Tien Wah shares rose 21 sen or 7.5% to RM3.01 for a market capitalisation of RM290.45 million. The stock saw 167,900 shares traded.

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