SINGAPORE (May 7): Sunningdale Tech, the precision plastic manufacturer, reported 1Q earnings fell 59.1% to $0.79 million from a year ago on lower sales from the automotive sector and lower margins.
No dividend has been declared for the quarter.
Group revenue fell 5.6% to $159.5 million as sales automotive mould fabrication decreased 14.5% due to fewer orders on weakening demand across global automotive markets, delays in new project launches and certain projects reaching end of life.
Gross profit margin dropped 1.9 percentage points to 10.8% although margin pressures are expected to ease in coming quarters.
Other income also fell, largely on the back of lower rental income after a factory in China was sold in the last quarter of 2018. The group also received fewer government grants.
In its outlook, Sunningdale Tech said it faces higher labour costs, pricing pressures and negative market sentiment as well as an automotive slowdown, especially in China.
However, the group said it will continue to monitor the market closely while aggressively pursuing business development initiatives to secure new projects.
Its healthcare and consumer and IT segments also gained “strong momentum”, thanks to several customer projects.
Shares in Sunningdale Tech closed 3 cents lower at $1.35 on Monday before the results were announced.
