Venture gets back-to-back profit boost from weak ringgit, strong greenback

Profits will jump as ringgit slides.

Venture Corporation, a mainboard-listed global electronics provider, will get a back-to-back profit boost as the Malaysian ringgit continues to slide against the strong US dollar.

DBS estimates that every 2% decline in MYR would have a 1.5% positive impact on Venture’s profits, as 60% of the group’s staff costs are denominated in the ringgit.

Meanwhile, every 1% rise in USD would have a 1% positive impact on Venture’s profits, as almost 100% of its sales are denominated in the greenback.

On the flip side, though, a strong USD could dampen demand from Europe and Asia, which account for 50% of the group’s sales.

DBS believes that strong balance sheet and its net cash position should support the current dividend payout of 50Scts, with a yield of around 6%.

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