April 9, 2024

Sunzen Biotech to close animal health division amid financial reorganisation

Sunzen Biotech has revealed plans to discontinue its underperforming animal health division as part of a strategic move to enhance the Malaysian company's financial performance, The Star reported.

According to a filing with Bursa Malaysia, the company cited sustained losses in the animal health unit over the past five financial years, attributing it to a challenging business landscape. In the fiscal year ending Dec 31, 2022 (FY22), the division contributed MYR 5.84 million (US$1.2 million) in revenue, constituting 6.01% of the group's consolidated revenue, while reporting a pre-tax loss of MYR 4.67 million (US$982,000).

Meanwhile, the company recorded a net profit of MYR 3.64 million (US$765,000) on revenue of MYR 97.1 million (US$20.4 million) in the same fiscal year.

Sunzen Biotech outlined its strategic realignment, emphasising a focus on its core businesses in human health and loan financing. These segments contributed 84.19% and 9.8% of the company's total revenue for FY22, respectively.

The company said cessation of operations of its animal health division will not have any material effect on the operations and financial performance for the financial year ending June 30, 2024.

Highlighting the decision's rationale, Sunzen Biotech underscored the division's lack of commercial viability and said that discontinuing its operations aligns with the company's best interests and the shareholders' collective benefit.

-      The Star