Logo of Phnom Penh Post newspaper Phnom Penh Post - GTI pins fall in Q2 profits on rising costs

GTI pins fall in Q2 profits on rising costs

An employee of Grand Twins International cleans and irons items of apparel in Phnom Penh’s Sen Sok district in 2014.
An employee of Grand Twins International cleans and irons items of apparel in Phnom Penh’s Sen Sok district in 2014. Vireak Mai

GTI pins fall in Q2 profits on rising costs

Taiwanese-owned garment manufacturer Grand Twins International (GTI) blamed its second-quarter decline in profits, which fell by 45 per cent compared to the same financial period last year, on the rising cost of labour and raw material imports.

The company’s announcement came a day after issuing its half-year and second-quarter financial reports, which showed revenue increased to $42 million during the first six months of the year, compared to $29 million during the same period in 2015, while profits fell to $3.6 million, from $4.3 million a year earlier.

However, during the second quarter of 2016 the company’s profits plunged to $2 million, from $3.6 million a year earlier, despite an additional $10 million in revenue.

The unaudited financial filing showed the majority of revenue was eaten up in a massive increase in cost of sales, a formula that combines labour, materials and overhead costs, which climbed from $8.5 million during the second quarter of 2015 to $23 million this year.

Henry Chan, GTI’s chief financial officer, told the Post yesterday that he expects revenue to continue to grow with the successful completion of expansions bankrolled by the $20 million the company raised during its initial public offering in 2014.

“As soon as GTI got the money from the public listing in 2014, we started our expansion plan to increase orders,” he said.

“The plan was completed last year and we can see the effects on our revenue.”

Chan did not address why the company’s second quarter profits were so low compared to revenue.

GTI has not released a growth forecast for the rest of this year. However, the company rounded out last year with a little over $1 million in profit.

GTI is owned by QMI Industrial Co Ltd, a British Virgin Islands-registered holding company. Its stock price rallied moderately yesterday, increasing by 4.85 per cent and closing the day at 3,460 riel ($0.84).

MOST VIEWED

  • Chikungunya hits 15 provinces, says gov’t

    Ministry of Health spokeswoman Or Vandine said on Thursday that the chikungunya outbreak in the Kingdom has spread to 15 provinces. Some 1,700 people are now suspected to have the disease. Vandine urged people to prevent its further spread by eliminating shelters for the Aedes aegypti mosquitoes

  • Body of woman killed in Bangkok returns

    The Cambodian embassy in Thailand is working to repatriate the body of a casino dealer who was shot dead in Bangkok on Monday night. Ministry of Foreign Affairs and International Cooperation spokesman Kuy Kuong told The Post on Wednesday that officials are preparing paperwork to

  • Gov’t exempts visa A and B holders from Covid fees

    Airline passengers who are diplomats and officials of international organisations holding Type A and B visas for travel to Cambodia are exempted from paying Covid-19 testing fees, said the Ministry of Health in its latest adjustment of rules on Wednesday. Health Minister Mam Bun Heng

  • All inbound flights set to face added scrutiny

    Ministry of Health spokesperson Or Vandine said on Monday that the ministry is monitoring all inbound flights, after it was announced that only those from Malaysia and Indonesia will be temporarily cancelled from August 1. Vandine said on Monday that the two countries were identified as