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Sunningdale Tech Q3 net profit drops 26% to S$5.57m
MAINBOARD-LISTED precision manufacturer Sunningdale Tech's earnings slid in the third quarter, as a fall in revenue was exacerbated by retrenchment costs, rents and other expenses, according to results released on Wednesday.
Net profit fell to S$5.57 million for the three months to Sept 30, down 25.9 per cent year-on-year, after revenue dropped 4.2 per cent to S$183.8 million on a broad-based decline.
Earnings per share came in at 2.92 Singapore cents against 3.98 cents before.
Contributions were down in all four business segments - automotive, consumer and information technology, healthcare and mould fabrication - which Sunningdale Tech said came on "trade war tensions and challenging market conditions".
Lead weights on turnover included a global automotive slowdown and the group's decision to leave "the lower-margin business of a particular customer" in the consumer/IT segment.
Meanwhile, Sunningdale Tech also notched a smaller currency gain than in the year-ago period, as well as what it dubbed "onerous rent" involving vacant premises in China and Thailand, which took their toll on the bottom line.
For the nine months, net profit was down 72.5 per cent to S$5.28 million, while revenue was 6.7 per cent lower at S$506.4 million.
Group chief executive Khoo Boo Hor said in an outlook statement that the automotive and consumer/IT segments are challenging, but Sunningdale Tech is positive on its healthcare business "as we have secured new projects from both new and existing customers".
The opening of a new plant in Penang and the relocation of operations from Shanghai to Chuzhou are also expected to ease the pressure on margins, he added.
No dividend was recommended, unchanged from the year before.
Sunningdale Tech closed up by S$0.04 or 3.18 per cent to S$1.30 on Wednesday before the results were released.