KNM reports higher 2Q profit but says outlook remains challenging

KUALA LUMPUR (Aug 26): KNM Group Bhd's net profit for the second quarter ended June 30, 2020 (2QFY20) jumped to RM11.22 million, from RM7.5 million a year ago.

This was despite revenue falling by 11.2% to RM333.03 million from RM375.03 million, the engineering and construction group said in a filing with Bursa Malaysia.

Compared with the preceding quarter, net profit fell 44.62% from RM20.26 million, mainly due to higher finance costs and lower revenue.

Finance costs incurred during 2QFY20 totalled RM15 million, about 20% higher compared with RM12.55 million in 1QFY20, the group said.

For the cumulative six-month period ended June 30, 2020, net profit rose 21.36% to RM31.48 million from RM25.94 million a year ago, on lower finance costs, while revenue dropped 9.32% to RM669.59 million from RM738.41 million.

Finance costs dropped 26% to RM27.55 million in the six-month period from RM37.29 million a year ago.

KNM expects the outlook for this year to remain challenging due to the continuous uncertainties on the global economy outlook and impact of the Covid-19 pandemic.

The stock closed unchanged at 22 sen today, valuing the group at RM591.89 million. Some 46.73 million were traded. Year-to-date, the stock has fallen 42% from 38sen on Dec 31, 2019.

Edited by S Kanagaraju