MAINBOARD-LISTED integrated fish service provider Qian Hu on Wednesday announced a 72 per cent year-on-year increase in net profit for the third quarter ended Sept 30 on the back of improved margins from the aquaculture business.

It posted a net profit of S$301,000 compared to S$175,000 in the year-ago period. This was achieved despite a 10.2 per cent drop in revenue to S$19.2 million from S$21.4 million. Lower revenue was a result of poorer sales recorded in the group's core fish and accessories business segments.

Qian Hu, which exports ornamental fish to more than 80 countries, saw fish sales fall by 12.6 per cent to S$7.5 million from S$8.6 million in the year-ago period, impacted by intense price competition in its prized Dragon Fish since FY2018. However, its aquaculture business in Hainan contributed positively, generating S$560,000 in operating profit, an increase of 16.7 per cent from S$480,000 for the same period last year.

Sale of accessories was also affected, dipping 11.4 per cent to S$8.6 million from S$9.7 million in the corresponding period a year ago, attributable to the disposal of the group's Shanghai subsidiary in Q4 FY2018 to streamline China operations, and weak global purchasing sentiment amid volatile markets. The effects spilled over to the segment's operating profit, which saw a 19.6 per cent decline to S$345,000 from S$429,000. 

The plastics segment, however, maintained sales at S$3.1 million and saw operating profits improve by 60.8 per cent to S$299,000 as a result of improved profit margins and a more diverse sales mix. 

Earnings per share rose to 0.27 Singapore cent in Q3 from 0.15 cent in the year-ago period while net asset value per share increased marginally by 1.5 per cent to 45.43 Singapore cents as at Sept 30. 

Qian Hu enjoyed a 61.2 per cent increase in net profit of S$574,000 for the nine months of FY2019 compared to S$356,000 for the same period in FY2018. But revenue stood at S$57.3 million, an 11.8 per cent decline from S$65 million in the year-ago period.

Kenny Yap, Qian Hu's executive chairman and managing director, said: "We are encouraged by the continued positive performance of our aquaculture business, in spite of the challenging business landscape across the globe. In the quarters ahead, we also hope to see the positive benefits from restructuring our accessories operations in China."

Qian Hu shares closed flat at S$0.128 on Wednesday.