Daibochi Plastic And Packaging Industry Bhd : Net Profit Flattish YoY, But Higher Earnings Expected Ahead

In line. Daibochi’s 1QFY12/10 net profit of RM5.0m (-0.3% yoy) was within our and consensus expectations, accounting for 19% of our and consensus full year net profit forecasts, respectively. We consider this to be in line with expectations due to the three-month time lag in passing on of rising raw material costs to customers (estimated to have negatively impacted 1Q10’s PBT by RM0.6m); the mismatch in timing of forex i.e. from purchases and collection from customers, which led to an unrealised loss of RM0.4m in 1Q10; as well as R&D expenses of about RM0.1m. The company declared a first interim net dividend of 3.5 sen, in line with our full year forecast of 19 sen.

Daibochi Plastic And Packaging Industry Bhd : Net Profit Flattish YoY, But Higher Earnings Expected Ahead