Aztech Global posts 8.7% higher net profit despite lower 1HFY2024 revenue, declares 66% higher dividend

Jovi Ho
2-min read

Aztech’s operating activities generated free cash flow of $57.1 million during 1HFY2024.

Mainboard-listed electronics manufacturer Aztech Global 8az 8az has posted net profit of $46.7 million for 1HFY2024 ended June 30, 8.7% higher y-o-y. This is despite revenue falling 4% y-o-y to $373.2 million over the six months.

Aztech’s board has declared an interim dividend of 5 cents per share, 66.7% higher y-o-y, to be paid on Aug 16.

The total dividend of $38.6 million represents a pay-out of 83% of the group’s net profits for 1HFY2024, above Aztech’s target to pay at least 30% of its net profits as dividend for FY2024.

Aztech reported a 7% y-o-y increase in profit before tax to $54.6 million, while net profit margin reached 12.5% for 1HFY2024.

Basic and diluted earnings per share for the period increased by 8.6% y-o-y to 6.04 cents.

For the most recent quarter, Aztech logged a 7.8% y-o-y increase in revenue to $244.6 million in 2QFY2024, and lifted total revenue for 1HFY2024 to $373.2 million.

Aztech reported cash and bank balances of $279 million, and a net cash of $274.1 million as at June 30, while its operating activities generated free cash flow of $57.1 million during 1HFY2024.

As at June 30, its net current assets were $334 million, while shareholders’ equity stood at $354.9 million.

Net asset value (NAV) per share increased from 45 cents as at Dec 31, 2023 to 46 cents as at June 30.

As at July 30, Aztech has secured an order book amounting to $304.4 million. The majority of the order book secured is scheduled for completion in FY2024.

Aztech’s management says it is cautious about economic prospects and inflationary cost pressure for the rest of the year due to trade and geopolitical tensions as well as increased competition.

Management says it has expanded its R&D headcount by 11% to enhance its R&D capabilities. It has also implemented a manufacturing execution system (MES) to automate better workflow at surface mount technology lines to improve operational efficiency, production yield and product quality.

To improve offerings at its Pasir Gudang facility in Johor, Malaysia, Aztech has set up plastic injection machines with completion expected in 3QFY2024 and mass production to start from 4QFY2024.

“With the Pasir Gudang facility also equipped with plastics production capabilities, the group is well-poised to seize opportunities to acquire new customers to diversify its customer base,” says Aztech.

While three new products from the health-tech and consumer segments have entered commercial production, there are five new products in the communication, consumer and health-tech segments scheduled for commercial production by the end of 2024, says Aztech.

Shares in Aztech Global closed 1 cent higher, or 0.99% up, at $1.02 on July 30.

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