Financial Highlights

The key financial highlights based on the historical audited combined financial statements of the company Group for the Financial Years Under Review are set out below:

• The revenue grew from RM 66 million in FYE 2021 to RM 151 million in FYE 2024, showing that the company is expanding its market share.

• The GP margin rose from 31.45% in FYE 2021 to 47.56% in FYE 2023, then fell to 42.55% in FYE 2024. This is mainly due to the increase in the cost of purchase and freight charges.

• The PAT margin increased from 11.76% in FYE 2021 to 22.20% in FYE 2023, but subsequently declined to 16.12% in FYE 2024.

• The gearing ratio is 0.29 in FYE 2024. The company's gearing ratio is within the benchmark, reflecting a good balance between debt and equity.  (A good gearing ratio should be between 0.25 – 0.5).

Major customers and suppliers

Major Customers

The company Group’s top five customers for the FYE 2024 are as follows:

The company is not dependent on any of the top five major customers. 

Major Suppliers

The company Group’s top five suppliers by total purchases for the FYE 2024 are as follows:

The company is not dependent on any of its suppliers as they maintain a list of approved third-party manufacturers which allow them to source high volume SKUs (e.g. water closets, from more than one third-party manufacturer.

Industry Overview

Bathroom and kitchen sanitary wares refer to a range of plumbing fittings and fixtures that are used in bathrooms and kitchens for sanitation purposes. The products are available in a wide range of designs and specifications to meet different consumer needs, and are made of materials that are durable and moisture proof to prevent rust, which are the essential characteristics of sanitary wares.

According to the research from SMITH ZANDER, the bathroom and kitchen sanitary ware industry, measured by revenue, was recorded at RM2.80 billion in 2022, increasing at a compound annual growth rate (“CAGR”) of 3.82% from RM2.41 billion in 2018. The size of the bathroom and kitchen sanitary ware industry in Malaysia was recorded at RM3.05 billion in 2023, a year-on-year (“YOY”) increase of 8.93% from 2022. 

The key drivers in this industry:

• Economic growth, rising population, urbanisation and rising affluence of the population drive the property market 

• Increasing demand for property drives property development as well as home improvement, maintenance and renovation activities

• Product innovation and increasingly sophisticated consumer lifestyle and aesthetic preferences

• Government initiatives to refurbish, maintain and construct public lavatories, public amenities, educational and sports facilities, and affordable housing projects

The key risk and challenges in this industry:

• Demand for bathroom and kitchen sanitary wares is subject to economic conditions and performance

• Industry players are exposed to competition as well as changes in consumer preferences

• Industry players are exposed to changes in regulations and regulatory standards

Future plans and strategies for OB HOLDINGS BERHAD

A summary of the company Group’s future plans and strategies is set out below:

1. The company intend to enhance its distribution reach to grow our market share by strengthening their support to existing dealers and expanding their network of dealers

2. The company intend to grow the revenue from project-based sales

3. The company intend to enhance their brand recognition through investment in branding and marketing activities in Malaysia

MQ Trader View 

Opportunities

1. The company has an extensive product range as a one-stop bathroom and kitchen sanitary wares’ solution provider for residential and commercial use

2. The company has a wide customer base including dealers, project customers and end-consumers through direct online stores

Risk 

1. The company house brands are critical to their success and the value of the brands and their reputation may be adversely affected by negative perception

2. The company is dependent on their third-party manufacturers as they are not involved in any manufacturing activities

3. The company may be adversely affected by product defects caused by their third-party manufacturers or logistics service providers, which may lead to product liability claims

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