Spindex Industries' earnings jump 75% as Covid-19 spurs demand for office equipment

PRECISION engineering group Spindex Industries saw a 75 per cent jump in net profit to S$21.3 million for the full year ended June 30, due in part to the Covid-19 pandemic.

Remote working has contributed to new demand for office equipment, domestic appliances and hobby-related equipment, while pandemic-related disruptions to the global supply chain have resulted in some forward stocking of components, the mainboard-listed company said in an exchange filing on Tuesday.

Accordingly, the company's revenue for FY21 rose 37 per cent to S$204.9 million despite generally uncertain and challenging market conditions, Spindex said.

Its machinery and automotive systems segment saw a 51 per cent growth in revenue in H2 FY21, compared with the same period in the previous year. Continued demand for office equipment pushed revenue growth up 69 per cent its imaging and printing segment in the same period.

Earnings per share is 18.44 cents, up from 10.57 in the preceding year.

Its directors has proposed a dividend per share of 4.5 Singapore cents.

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Looking ahead, however, Spindex said business visibility remains limited and it is also "premature" to assume that containment of the virus will result in additional demand.

This is because its supply chain has been disrupted as a result of logistics delays and supplier closures due to the spread of new variants of Covid-19, and government-mandated restrictions on operations and commodity pricing could raise business costs and pose further challenges.

Ongoing geopolitical factors such as tariffs would also have an impact on customer demand, the company said.

Still, the company's strong financial position has allowed it to invest for long-term growth while maintaining a healthy level of cash and cash equivalents of S$43.9 million, it said.

Its main cash outflow items under investing and financing activities were purchase of property, plant and equipment and the payment of dividends.

Spindex shares closed flat at S$1.20 on Tuesday.