Pecca Latest QR Summary

Pecca Group Berhad's FY2024 Fourth Quarter Results:

1. Financial Performance 💰
✅- Revenue: Increased by 1% to RM54.99 million in Q4 FY2024 compared to Q4 FY2023. For the full year FY2024, revenue grew by 10% to RM242.4 million.
✅- Profit After Tax (PAT): Rose by 44% to RM14.57 million in Q4 FY2024 and by 55% to RM55.03 million in FY2024.
✅- Cost Efficiency: Improvement in PAT mainly attributed to better production cost efficiency in the Automotive segment.
- Revenue Contribution: Upholstery car seat covers, sewing and supply of car accessories cover, and related services contributed approximately 99% of total revenue. Within leather car seat covers segment, OEM contributed about 90% of total revenue.

2. Dividends 💵
✅- Total dividend declared for FY2024 is 5.00 sen per ordinary share compared to 2.76 sen per ordinary share in FY2023.

3. Business Segments 💼
🚗- Automotive Segment:
- In first six months of 2024, industry witnessed robust growth. New vehicle sales measured by total industry volume (TIV) increased by 6.6% year-on-year.
- Aim to secure more REM orders in US, Middle East, Australia, Singapore, and Europe in FY2025. REM parts generally command better profit margins.
- Working on securing OEM contracts for PT Pecca Gemilang Indonesia. Securing OEM contracts typically takes 2 to 3 years.
- Second plant at UMW High Value Manufacturing Park in Serendah, Selangor will double production capacity when operational.
✈️- Aviation Segment:
- Completed first purchase order for a 180-seat, Europe-registered Airbus A320 passenger aircraft in Q4 FY2024.
- Strategic priorities in FY2025 include widening regional customer base, securing more passenger aircraft orders, and expanding product and service offerings.

4. Utilisation of Proceeds 🧾
- Extension of time for utilisation of IPO proceeds for working capital approved until 19 April 2026 due to REM segment expanding to more export markets.

5. Borrowings and Guarantees 🪙
- Short-term and long-term borrowings as of 30 June 2024. Group has extended corporate guarantees to financial institutions for subsidiary, but financial impact is immaterial as subsidiary is in positive financial standings.

⚠️ Conclusion on Investment Potential:
The company shows several positive signs that may make it an attractive investment option:
✅- Consistent revenue growth and significant improvement in profit after tax, indicating efficient operations and potential for future profitability.
✅- Active efforts in expanding business segments, both in the automotive (increasing REM orders and working on OEM contracts in Indonesia) and aviation sectors, which could lead to increased market share and revenue diversification.
✅- Dividend increase shows confidence in the company's financial health and rewards shareholders.
✅- Planned expansion of production capacity through the new plant could meet growing demand and drive further growth.
✅- Utilisation of IPO proceeds is well-managed and extended for strategic purposes.
✅- Absence of material litigation and contingent liabilities reduces potential risks.

Disclaimer: For educational purposes only. Please consult your professional financial advisor.