S. Birruntha

KUALA LUMPUR: Sunzen Biotech Bhd today announced that it has started the process to shut down its loss-making animal health division to reduce the financial expenditures and strengthen the financial performance of the company.

In a filing to Bursa Malaysia, Sunzen said the animal health division has been continuously incurring losses for the past financial years amidst the challenging business environment.

It added that this has strained the overall financial condition of the company despite concerted efforts of the management team to overcome the challenging business environment for the animal health industry.

In the financial year ended Dec 31, 2022 (FY22), the division made a revenue contribution of RM5.84 million, representing 6.01 per cent of the company's revenue on a consolidated basis, while pre-tax loss stood at RM4.67 million.

Meanwhile, in FY22, Sunzen achieved a net profit of RM3.64 million and generated a total revenue of RM97.1 million. Going forward, Sunzen said it would focus its resources on the existing businesses in human health and loan financing, which respectively contributed 84.19 per cent and 9.80 per cent to the total revenue of the company for FY22. "The company and its board of directors are of the view that animal health division is no longer commercially sustainable. "We consider that the cessation of the business operations of animal health division is in the best interest of the company and the shareholders as a whole," it noted.

Sunzen also said the shutdown of the animal health division will not have any material effect on the operations and financial performance of the financial year ending June 30, 2024.

Sunzen's share price was up 1.49 per cent to 34 sen a share, as at 3.08pm.