Masteel Returns to Profit in the Second Quarter, Owing to Increased Sales Volume and Steel Bar Prices

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Malaysia Steel Works (KL) Bhd (Masteel) has turned a profit in the second quarter, owing to increased steel bar sales volume and selling prices.

For the quarter ended June 30, 2021 (2QFY21), it reported a net profit of RM9.39 million or earnings per share of 2.07 sen, compared to a net loss of RM22.53 million or loss per share of 5.11 sen in the same time last year.

Revenue increased by 80.52 percent year on year to RM353.14 million from RM195.63 million in the previous quarter.

Masteel earned RM17.78 million in the six months to June, compared to a loss of RM26.7 million in the same period previous year. Revenue for the first six months increased 33.65 percent to RM792.87 million from RM593.27 million.

“We could have posted a stronger second quarter had it not been for the June implementation of the Full Movement Control Order (FMCO). The enhanced result was aided by our operations’ effectiveness in adjusting to Malaysia’s Covid-19 pandemic situation,” said Masteel managing director and chief executive officer Datuk Tai Hean Leng.

“Additionally, our strategic location in the Klang Valley, close to significant building activity, along with our big capacity and consistent delivery, positions us well to capitalise on the growth in steel bar demand,” he added.

Tai expressed relief that tight limits imposed earlier this month under the National Recovery Plan have been lifted, allowing the business to restore its ideal production rate.

He stated that now that the FMCO has been lifted, the business is experiencing a resurgence in steel bar orders from the construction sector.

“We anticipate steel bar demand to gradually recover to pre-FMCO levels in the second half of 2021 (2H21), aided by the completion of ongoing construction jobs and the rollout of large infrastructure projects.

“In addition, we will continue to export our steel products to regional markets where demand is robust. In light of this, we are confident in our ability to deliver a resilient 2H21 performance,” he added.

Masteel’s share price ended 1.5 sen or 3.49 percent lower at 41.5 sen, valuing the company at RM282 million.

Published by Zack Baharum

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