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Hi-P back in the black with S$8.4m Q1 profit as revenue falls

MANUFACTURER of consumer electronics Hi-P is back in the black for the first quarter of its financial year 2017, reporting a net profit of S$8.4 million as compared to a loss of S$12.4 million a year ago.

This comes even as it saw an 11.4 per cent drop in revenue to S$244.2 million.

Details of its first-quarter results were released on Thursday. No dividend was declared.

Singapore-based, mainboard-listed Hi-P said that the fall in revenue was due to fewer high component content assembly products.

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But net profits increased. This was due to a better product mix, improved operational efficiency and cost management, and lower inventory provision and scrap expenses.

Net interest expense fell by 87.6 per cent to S$0.1 million for Q1 2017 as its net debt position improved.

Other income decreased by 21.9 per cent to S$1.3 million for Q1 as it received fewer government incentives.

Other expenses decreased by 54.8 per cent to S$3.6 million. This was due to lower net loss arising from net foreign exchange differences and fair value loss on hedging contracts.

The group saw an income tax expense of S$3.5 million for Q1, representing an effective tax rate of 29.3 per cent. This was the result of taxes imposed on profitable entities, and certain deferred tax assets not being recognised.

Hi-P's counter closed 4.93 per cent higher at S$0.745 on Thursday before the announcement.