The company saw its second quarter profit rise RM241.83% to RM5.65 million from RM1.65 million in the previous corresponding period.
This was achieved on the back of just a 1.24% increase in revenue to RM104.06 million.
In a statement to the media today, PCCS said the lion’s share of its net profit in the quarter ended Sept 30, 2022 came from a foreign exchange gain of RM4.43 million.
It said its credit financing business, which began operations in August last year, contributed about 10% of the net profit.
PCCS said the business has booked revenue of RM1.29 million for the quarter and is already recording double digit growth and margins.
For the cumulative six-month period, the credit financing division has contributed revenue of RM2.27 million, it added.
“Moving forward, the credit finance business is expected to help support the seasonal nature of our core athletic apparel business, and therefore provide greater stability in earnings,” the company said.
The remainder of the profits was contributed by the PCCS core apparel business in China.
For the six-month period, PCCS recorded an extraordinary gain of RM6.9 million, which came from the disposal of its subsidiaries Mega Label (Malaysia) Sdn Bhd and Mega Label (Penang) Sdn Bhd in its first quarter.
Setting aside these extraordinary gains, PCCS recorded a net profit of RM8.4 million for the first quarter to June 30, 2022 (Q1 2022).
Apart from the athletic apparel division, which accounts for 90% of PCCS business, the company also has a hire purchase and a medical devices division.
China, Europe and the Americas are the largest markets for its sportswear.
However, the company continues to face some challenges. Group managing director David Chan said there has been some delays and setbacks in manufacturing because of the stricter anti-Covid-19 measures taken by China.
“This is out of our control and we do foresee that the apparel business in Cambodia and China will see a downturn in sales in the next quarter,” he said.
However, he added, the company is already better prepared for the challenges and it expects the hiccups in the supply chain to get more manageable going forward.