Thakral turns around with $5.7m Q4 profit

THAKRAL Corporation chalked up a net profit of $5.7 million for the fourth quarter ended Dec 31 – a turnaround from an $11.2 million loss a year earlier – thanks to higher sales and bigger margins.

Revenue for the quarter surged 23 per cent to $111.7 million, from $90.56 million.

Earnings per share – for continuing and discontinued operations – were 0.22 cent, compared with a loss per share of 0.43 cent in Q4 2008.

For the full year, the group swung into the black with a net profit of $11.5 million, versus a loss of $20.47 million in FY 2008. Revenue rose 15 per cent to $438.8 million on the back of its consumer electronics distribution business, which accounted for 99.2 per cent of group revenue.

The group recently landed a three-year $20.6 million deal with Lenovo (Beijing) under which its subsidiary Thakral China will be the exclusive distributor of Lenovo’s game players and media players in China.

Thakral Corporation’s executive chairman Kartar Singh Thakral said: ‘Moving ahead, the group intends to divest certain listed investments to meet the cash requirements for the upcoming capital reduction approved by shareholders at the recent extraordinary general meeting. This will bring about a decline in dividend and interest income in FY 2010.’

Thakral is returning $130.6 million to shareholders, at five cents a share, by way of the capital reduction.

The group also said yesterday it remains upbeat about growth prospects as it continues to look for opportunities to invest in property ventures across Asia.

Thakral said in December that it was dropping plans to switch its core business from consumer electronics distribution to real estate, although it emphasised that it ‘has always had an ancillary business in real estate and will continue to evaluate and invest in property ventures within the available funds’.

Major shareholder Hong Leong Asia – which has a 34.4 per cent stake in Thakral through China Yuchai International – also announced in December plans to pare its stake through a placement.

Thakral shares closed unchanged yesterday at 7.5 cents.

Source : Business Times – 20 Feb 2010