SINGAPORE - Investors dumped shares of NanoFilm Technologies on Monday (Aug 16), unnerved by the resignation of the company's chief operating officer (COO), which was announced after the market closed last Friday.
The nanotechnology company last Friday reported a 2.3 per cent drop in net profit after tax for the first half of the year, missing analyst expectations.
Its stock closed on Monday at $4.25, down $1.72, or 28.8 per cent.
Speaking at a results briefing on Monday, deputy chief executive Gian Yi Hsen said COO Ricky Tan's resignation was "part and parcel of a corporate restructuring under which a business unit head is appointed to directly oversee each division of the company".
"This will help to drive and accelerate business growth more effectively," Mr Gian said, adding that there is no need for an additional layer of reporting under the COO and that Mr Tan's departure will have "minimal impact" on NanoFilm's operations.
Mr Tan's resignation comes less than two months after chief executive Lee Liang Huang stepped down on June 22 due to health reasons.
Mr Lee was appointed as chief executive in November 2017.
Since then, NanoFilm founder and executive chairman Shi Xu has assumed the role of interim chief executive.
Dr Shi was recently added to Forbes' Singapore's 50 Richest list, coming in at No. 24 with a net worth tagged at US$1.8 billion (S$2.4 billion).
The 57-year-old professor-turned-entrepreneur made his fortune after listing his company, which makes high-tech carbon coating used in cars, smartphones and computers, on the Singapore Exchange at $2.59 a share in October last year, raising $470 million.
He retains a 53 per cent stake in NanoFilm.
Dr Shi, a Chinese national who arrived here in 1991 and is now a Singapore citizen, started NanoFilm while working at the Nanyang Technological University's School of Electrical and Electronic Engineering.
For the first half of the year, NanoFilm's revenue increased by 24.2 per cent to $96.6 million compared with a year ago. This was supported by the advanced materials and industrial equipment units.
However, net profit after tax was 2.3 per cent lower, at $18.1 million, compared with the same period last year due to expenses incurred at its new plant in Shanghai.
The company racked up expenses on its new product introduction projects, which have yet to contribute materially to revenue.
The board declared an interim dividend of one cent per ordinary share for the financial year ended Dec 31, which will be paid on Sept 8.
NanoFilm sees better growth for its advanced materials business from customers such as makers of smartphones, vehicles and optical lenses as well as companies involved in precision engineering and printing and imaging.
It also expects to enter new sectors such as medical devices and optics.
Last month, NanoFilm shares hit an all-time high of $6.53, a week after the company announced a joint venture with Temasek to develop hydrogen energy solutions.