Notion Vtec II

Notion announced its earnings, Quarterly rpt on consolidated results for the financial period ended 30/6/2007

Have a look at this table which shows its quarterly earnings since listing.



There is a drastic drop in earnings and there was drastic erosion in its earnings margins.

The company explained in its earnings notes.

• COMPARISON WITH PRECEDING QUARTER'S RESULTS
  
  The Group recorded lower revenue of RM22.23 million in the quarter under review (“Q3 2007”) as compared to RM28.28 million achieved in the previous quarter (“Q2 2007”). PBT decreased from RM10.01 million in Q2 2007 to RM2.23 million in Q3 2007. PBT margin also decreased from 35.4% in Q2 2007 to 10.0% in Q3 2007.
  
  The comparatively weaker performance in Q3 2007 was mainly attributed to the following:
  
  (a)Lower contribution from the camera components business segment due to significantly lower sales orders from the major SLR camera manufacturers. The poor performance of the camera segment was mainly attributed to high camera inventory levels experienced by the industry, which generally is the norm as seasonally the camera market tends to be soft during this time of the year.
  
  For Q3 2007, the Group achieved a product mix ratio (HDD: Camera: Industrial segments) of 53%: 22%: 26% compared to 54%: 29%: 17% ratio achieved in Q2 2007.
  
  (b)The HDD segment was also adversely affected by increased competition, resulting in its margins being squeezed coupled with lower volume orders from some of its major customers.
  
  (c)Impact of the strengthening Ringgit (RM) against the US Dollar (USD), particularly, for export orientated companies. Consequently, the Group suffered foreign exchange losses which arose from the difference in book RM/USD rate compared to the realized RM/USD rate.

How?

You have the lower earnings and then you have the Special Issues of Shares to consider.