KUALA LUMPUR (Aug 27): Ann Joo Resources Bhd saw a 27.7% decline in net profit to RM20.7 million for its second quarter ended June 30, 2018 (2QFY18) from RM28.62 million a year ago, notwithstanding higher revenue recorded.

This resulted in a weaker earnings per share of 3.88 sen for 2QFY18 compared with 5.68 sen for 2QFY17.

In an exchange filing today, Ann Joo said it incurred a net foreign exchange (forex) loss amounting to RM4.49 million, compared with a net forex gain of RM2.78 million in 2QFY17.

Quarterly revenue, meanwhile, came in 3.8% higher at RM509.63 million versus RM490.75 million a year ago, due to slightly improved selling prices.

The group declared an interim single-tier dividend of six sen per share, payable on Sept 27.

For the first half of the year (1HFY18), the group's net profit decreased 20% to RM82.15 million from RM102.62 million a year ago, even though revenue grew 11% to RM1.1 billion, from RM989.92 million before.

Looking ahead, Ann Joo said it is cautious about the steel sector outlook due to trade frictions across the US, China and the European Union, and soft local demand amid the government’s review on infrastructure spending.

It, however, is confident of remaining price competitive in the export markets, and expects to beef up its proportion of export sales amidst lacklustre near-term domestic demand.

“In view of the adverse external environment and market volatility, the group is cautious about the steel sector outlook. Nonetheless, given its continued focus on cost efficiency, the group expects its performance to remain relatively satisfactory in the remaining period of 2018,” it said.

Shares in Ann Joo closed unchanged at RM1.97 today, for a market capitalisation of RM1.06 billion.