BPPLAS recorded highest ever Annual Revenue of RM324.36 million in FY2016
Batu Pahat, 26 May 2017 – Riding on the Group’s aspiration to become a progressive and sustainable Company with targeted annual revenue exceeding RM400 million by FY2018, BPPLAS has embarked on Product Innovation, Market Expansion, Skills Set and Competencies Upgrading, Human Capital Development and Machine Capacity Addition in FY2016. Through its continued growth strategies of capacity building, this has allowed the Group to achieve its highest ever Annual Revenue of RM324.36 million in FY2016, amidst an uneven global economic recovery and subdued growth across major economies in US, China and Eurozone.
With the successful commissioning start-up of its new 3-meter 6th Cast Stretch Film machine at the end of FY2016, BPPLAS is now able to supply a wider range of Innovative and Competitive High Quality Cast Stretch Film products to cater for different market segment needs in Primary, Secondary and Tertiary packaging. Leveraging on its in-house technical on-going product developments and innovation, the Group has also successfully supplied Blown Polyethylene (PE) Film products for high-speed fully automated Form-Fill-Seal packaging lines, to embark on further topline growth in the Food & Beverage (“F&B”) packaging segment as well.
Despite the intense competition and pricing pressure within the plastics packaging film industry, as other major producers similarly increased their capacity, the Group registered a 14.43% increase in operating revenue, from RM283.46 million in FY2015 to RM324.36 million in FY2016, mainly due to increased production capacity and higher contribution from export sales of RM255.91 million (FY2015: RM223.81 million).
During FY2016, 79% of its total revenue comprised of export sales to more than 54 countries worldwide, with major strategic business partners located mainly in South Korea, Japan and ASEAN countries. Other export destinations in which BPPLAS has presence include Australasia, Europe, South Asia, Middle East, and the African and South American countries. Not withstanding the sustained topline year-on-year sales growth, the Group’s Profit Before Tax (“PBT”) and profit margins particularly in the 2nd Half of 2016, were affected by margin compression arising from higher operating costs and increase in resin prices due to the weaker RM against United States Dollar (“USD”), along with the lag-on effect in selling price adjustment. The Group achieved a lower PBT of RM22.87 million, a decrease of 16.26% as compared to PBT of RM27.31 million in FY2015. Profit After Tax (“PAT”) was also lowered by 18.17% at RM17.87 million, compared to the PAT of RM21.83 million in FY2015.
As at 31 December 2016, the Group’s Statement of Financial Position remained healthy with Cash and Cash Equivalents of RM45.07 million (FY2015: RM60.29 million) despite hefty investment in advanced machinery and attractive dividend payout totalling approximately RM32 million. The Group has no loans and borrowings as at the financial year ended 31 December 2016. Total dividends declared and paid out by the Group for FY2016 amounted to RM15.012 million,
representing an 84% dividend payout ratio (FY2015: 69%). Total shareholders’ equity was RM165.77 million and Net Tangible Assets (“NTA”) per share stood atRM0.88 as at the financial year ended 31 December 2016. With the newly-added capacity from its 6th Cast Stretch Film machine, the Group will be better positioned to expand into thin gauge films that offer cost-savings and improved load rigidity for its customers.
Moving forward, BPPLAS will be applying for ISO22000:2008 certification for its Co-Extrusion (“COEX”) Blown Film and Printing division by 3rd Quarter 2017, and erect its new factory and warehouse building which is expected to be completed within the year, to expand on its storage capacity and improve on operational workflow efficiency catering for food packaging hygiene requirement standards. The Group also anticipates to further invest between RM20 million to RM30 million for FY2017 and FY2018 into high technology machines, which potentially include a new 4th COEX Blown Film machine to cater to the packaging needs of its existing and new customers in blown film products and a new 7th Cast Stretch Film machine by FY2018 to move into more sophisticated industrial packaging needs of its export market customers, focusing on improved load holding and safety features.
At BPPLAS AGM held earlier today, Mr. Lim Chun Yow, the Managing Director also shared that the First Quarter results of FY2017 have been announced via Bursa LINK. For the 3 months ended 31 March 2017, the Group achieved slightly lower operating revenue of RM84.33 million, a decrease of 1.20% compared to RM85.36 million in the corresponding period last year. The Group achieved a lower unaudited PBT for the period under review of RM5.03 million, a decrease of 33.64% compared to unaudited PBT of RM7.58 million in the same period last year. Unaudited PAT for the period under review was also lower by 37.20% at RM3.63 million, compared to the unaudited PAT of RM5.78 million in the same corresponding period last year. The decline in PBT and PAT for the period under review were mainly due to significant increase in resin prices and production costs.
Mr. Lim further shared that the Board of Directors has declared a first Single Tier interim dividend of 2 sen per share in respect of FY2017. The entitlement date is fixed on 19 June 2017 and payment will be made on 30 June 2017.
Barring any unforeseen circumstances, the Group endeavours to deliver a satisfactory performance for the financial year ending 31 December 2017.
For more information, please contact:
BP Plastics Holding Bhd.
Contact: 607-455 7633