GGRAsia – RGB 1Q profit down despite 48pct revenue increase

RGB 1Q profit down despite 48pct revenue increase

Jul 01, 2020 Newsdesk Latest News, Rest of Asia, Top of the deck

Casino equipment maker RGB International Bhd reported on Tuesday first quarter profit that was down 46.4 percent judged year-on-year, to MYR3.6 million (US$841,119). Such decline was despite a 48.4-percent increase in revenue during the period, the firm said in a filing to Bursa Malaysia.

Group revenue during the three months to March 31 was MYR77.4 million, compared to nearly MYR52.2 million a year earlier. The group’s cost of sales however jumped 90.3 percent year-on-year, to MYR63.7 million.

Earnings before interest, taxation, depreciation and amortisation (EBITDA) were nearly MYR18.6 million in the opening quarter of 2020, up 23.0 percent from the prior-year period.

Revenue from product sales and marketing – the firm’s main segment – doubled from the prior-year period to just above MYR44.0 million in the reporting period. Profit before tax for the division more than doubled in year-on-year terms to MYR7.8 million in the first quarter, which the company said was due to an “increase in number of products sold” in the reporting quarter.

The technical support and management division achieved revenue of MYR32.7 million for the quarter to March 31, up 10.8 percent compared to the corresponding quarter in 2019. This segment however reported a loss before tax of nearly MYR2.1 million, compared to a profit of MYR5.9 million a year earlier. The company said such result was in part due to “loss of revenue during the lockdown period imposed by various countries starting from mid-March 2020 as part of the measures to prevent the spreading of Covid-19.”

In Tuesday’s filing, RGB said some of its clients in the Asia-Pacific region had resumed operations in May, after being temporarily suspended as part of efforts to stem the spread of Covid-19.

“The financial impact of the Covid-19 pandemic could be significant to the group,” said RGB, adding that it continued “to implement various cost control measures … to contain its expenditures” during this period.

The casino equipment maker and distributor said last month that it would not pay a final dividend for the financial year to December 31, 2019 due to the business disruption wrought by the global coronavirus crisis.