Hence, gross profit for the quarter came in at $8.14 million, 38.2% higher than $5.88 million a year ago.
Following the results announcement, Phillip Capital is maintaining its “buy” call on Nam Lee with a target price of 56 cents.
The group’s increase in revenue was driven by its Aluminium segment.
In a Monday report, analyst Richard Leow says that this was attributable to the group’s industrial product of aluminium frames for container refrigeration units.
However, trade receivables increased q-o-q to $55.7 million, which was the largest working capital contributing factor to the lower cash balance q-o-q of $31.8 million.
Nonetheless, the increase in trade receivables was due to higher sales during the quarter.
On the outlook, the analyst believes that it will be stable to positive. He also reckons that the tone of the group’s management is noticeably upbeat compared to last year.
Management expects the US economic recovery to bring positive impact on the aluminium industrial product business – which refers to the group’s aluminium frames for container refrigeration units.
To recap, this was previously highlighted in the research house’s previous report, stating that the demand outlook has improved and that the group’s current 1Q18 has reflected the positive demand.
See: Phillip sees Nam Lee as attractive yield play riding on recovering US economy
As at 11.10am, shares in Nam Lee are trading 1 cent higher at 39 cents or 7.5 times FY18 earnings with a dividend yield of 6.6%.
