KEIN HING INTERNATIONAL BERHAD: Navigating Growth Amidst Global Headwinds
Greetings, fellow investors! Today, we’re diving deep into the latest financial performance of KEIN HING INTERNATIONAL BERHAD, a prominent player in the manufacturing and trading sectors. The company has just released its unaudited results for the fourth quarter and full financial year ended 30 April 2025. This report offers a crucial glimpse into its operational resilience and strategic direction in a dynamic economic landscape.
What’s the core takeaway? KEIN HING has demonstrated commendable revenue growth for both the quarter and the full year, showcasing its ability to expand its top line. However, like many businesses operating internationally, it faces the complexities of currency fluctuations and broader economic uncertainties. Let’s unpack the numbers and see what they tell us about the company’s journey.
Core Data Highlights: A Closer Look at Performance
Quarterly Performance: A Strong Finish to the Year
The fourth quarter witnessed a significant uplift in KEIN HING’s performance, particularly in its profit before tax. This surge was largely driven by robust revenue growth from its Vietnam operations and effective cost controls.
Q4 FY2025 (3 Months Ended 30 Apr 2025)
Revenue: RM81,140,000
Operating Profit: RM4,783,000
Profit Before Tax (PBT): RM4,316,000
Profit for the Year: RM2,541,000
Profit Attributable to Owners: RM1,952,000
Basic Earnings Per Share: 1.79 sen
Q4 FY2024 (3 Months Ended 30 Apr 2024)
Revenue: RM67,667,000
Operating Profit: RM2,735,000
Profit Before Tax (PBT): RM2,199,000
Profit for the Year: RM2,382,000
Profit Attributable to Owners: RM2,433,000
Basic Earnings Per Share: 2.23 sen
For the fourth quarter, revenue increased by 20% to RM81.14 million compared to RM67.67 million in the same period last year. Profit Before Tax (PBT) saw an impressive 96% jump, reaching RM4.32 million from RM2.20 million. This significant improvement in PBT was primarily due to higher revenue and better contribution margins from the Vietnam Operation, coupled with the Group’s fixed cost control measures. However, it’s noteworthy that profit attributable to owners saw a 20% decline, from RM2.43 million to RM1.95 million, despite the overall profit growth. This was largely influenced by a net foreign exchange loss of RM0.88 million in the current quarter, a stark contrast to a net gain of RM0.53 million in the previous corresponding quarter.
Full Year Performance: Sustained Growth
Looking at the entire financial year, KEIN HING maintained its growth trajectory, with a solid increase in overall revenue and a stable operating profit despite external pressures.
FY2025 (Financial Year Ended 30 Apr 2025)
Revenue: RM327,932,000
Operating Profit: RM22,287,000
Profit Before Tax (PBT): RM20,232,000
Profit for the Year: RM15,732,000
Profit Attributable to Owners: RM12,135,000
Basic Earnings Per Share: 11.14 sen
FY2024 (Financial Year Ended 30 Apr 2024)
Revenue: RM298,571,000
Operating Profit: RM22,237,000
Profit Before Tax (PBT): RM19,404,000
Profit for the Year: RM15,983,000
Profit Attributable to Owners: RM15,076,000
Basic Earnings Per Share: 13.84 sen
For the full financial year, KEIN HING’s revenue grew by 10% to RM327.93 million from RM298.57 million in the previous year. PBT saw a 4% increase to RM20.23 million. Similar to the quarterly results, the full-year profit attributable to owners decreased by 20%, from RM15.08 million to RM12.14 million. This was significantly impacted by a net foreign exchange loss of RM2.09 million for the full year, a substantial swing from a gain of RM3.86 million in the prior year.
Geographical Contributions: Vietnam Leads the Charge
A deeper dive into the revenue streams reveals the differing contributions from the Group’s Malaysian and Vietnamese operations.
| Operation | Q4 FY2025 (RM’000) | Q4 FY2024 (RM’000) | Change (RM’000) | Change (%) |
|---|---|---|---|---|
| Malaysia Operation | 33,630 | 30,752 | 2,878 | 9% |
| Vietnam Operation | 47,510 | 36,915 | 10,595 | 29% |
| Total Revenue | 81,140 | 67,667 | 13,473 | 20% |
| Operation | FY2025 (RM’000) | FY2024 (RM’000) | Change (RM’000) | Change (%) |
|---|---|---|---|---|
| Malaysia Operation | 140,762 | 138,538 | 2,224 | 2% |
| Vietnam Operation | 187,170 | 160,033 | 27,137 | 17% |
| Total Revenue | 327,932 | 298,571 | 29,361 | 10% |
For the fourth quarter, both Malaysia and Vietnam operations showed improvement, with Vietnam leading the way with a 29% increase in revenue, primarily due to the timing of Chinese New Year holidays. For the full financial year, Malaysia’s revenue saw a slight 2% improvement, driven by higher sales of screen display parts. Vietnam, however, was the star performer, recording a remarkable 17% growth in revenue, largely attributed to a surge in demand for parts used in printer products and home appliances. This shifted the revenue contribution ratio for the full year to 43% from Malaysia and 57% from Vietnam, compared to 46%:54% previously, indicating a growing reliance on the Vietnamese market.
Financial Health and Cash Flow
The Group’s financial position remains robust, with a healthy equity base and prudent cash management.
- Equity attributable to owners stood at RM179.1 million as at 30 April 2025, an increase from RM174.8 million a year ago, even after deducting RM2.7 million in dividend payments. This translates to a Net Assets per share of RM1.65 (compared to RM1.60 previously).
- Cash and cash equivalents decreased from RM82.4 million to RM60.4 million. This decrease was mainly due to changes in working capital and significant payments totaling RM10.6 million for the acquisition of investment property and right-of-use assets during the financial year. Despite this, the Group emphasizes its prudent management in maintaining sufficient cash and committed credit facilities.
- Total loans and borrowings saw a decrease from RM51.07 million to RM41.35 million, indicating a reduction in overall debt.
Risks and Prospects: Navigating a Challenging Global Environment
Looking ahead, KEIN HING acknowledges the prevailing global economic uncertainties. The International Monetary Fund’s (IMF) World Economic Outlook projects a slowdown in global growth, with significant downside risks stemming from escalating trade tensions and high policy uncertainty, particularly influenced by US trade tariffs.
This macro environment suggests that KEIN HING may experience fluctuations in customer demand, which could impact revenue growth for the financial year ending 30 April 2026. The company’s continued focus on cost control measures, as evidenced by the improved operating profit in the recent quarter, will be crucial in mitigating these external pressures. Furthermore, its strategic investments in new subsidiaries like KHI Eduhouse Sdn. Bhd. and Kein Hing Muramoto (Hung Yen) Joint Stock Company, along with the increased stake in Kein Hing Muramoto (Vietnam) Co., Ltd., suggest a long-term vision for diversification and strengthening its core businesses, especially in the promising Vietnamese market.
Dividends: Returning Value to Shareholders
The Board of Directors has proposed a first and final single tier dividend of 2.5 sen per share for the financial year ended 30 April 2025. This amounts to a total dividend payout of RM2.72 million, consistent with the dividend paid in the previous financial year. This demonstrates the company’s commitment to returning value to its shareholders, even amidst a challenging operational environment.
Summary and Investment Recommendations
KEIN HING INTERNATIONAL BERHAD has concluded its financial year with a mixed but generally positive report. The company achieved solid revenue growth, primarily driven by its robust Vietnam operations, and managed to improve its profit before tax for both the quarter and the full year. This indicates strong operational capabilities and effective cost management. However, the impact of foreign exchange losses significantly affected the profit attributable to owners, highlighting the volatility inherent in international business.
Key points from the report include:
- Strong Revenue Growth: A 10% increase in full-year revenue and a 20% jump in Q4 revenue.
- Vietnam as a Growth Engine: The Vietnamese operations are increasingly contributing to the Group’s top line, driven by demand for printer and home appliance parts.
- Prudent Financial Management: Stable equity and a reduction in overall borrowings, despite significant investments in new assets.
- Foreign Exchange Impact: Currency fluctuations posed a notable headwind, impacting net profit attributable to owners.
- Global Economic Headwinds: The company acknowledges potential challenges from global economic uncertainty and trade tensions.
Looking ahead, KEIN HING’s strategic expansions and continued focus on operational efficiency position it to navigate the anticipated economic headwinds. The consistent dividend payout also reflects a stable approach to shareholder returns.
From a professional standpoint, KEIN HING’s latest report paints a picture of a resilient company that is actively managing its operations and seeking growth opportunities, particularly in expanding markets like Vietnam. While the foreign exchange volatility is a factor to monitor, the underlying business appears to be performing well.
What are your thoughts on KEIN HING’s performance? Do you believe the company can maintain its growth momentum in the face of global economic uncertainties? Share your insights and perspectives in the comments section below!
