KUALA LUMPUR (March 29): Hiap Teck Venture Bhd's second quarter net profit multiplied by almost eight times, thanks to lower finance costs and higher contribution from a joint venture (JV), with the latter boosted by a substantial unrealised foreign exchange gain due to a stronger ringgit.

Quarterly earnings for the three months ended Jan 31, 2018 (2QFY18) jumped to RM30.55 million from RM3.9 million a year ago. It booked an RM18.9 million share of profit from its JV, as opposed to a share of loss of RM30.18 million a year ago, its Bursa Malaysia filing today showed.

Quarterly revenue was up 12% year-on-year (y-o-y) at RM302.48 million from RM269.13 million.

Hiap Teck said the higher revenue was due to better selling prices in both its trading and manufacturing divisions, which have offset a lower y-o-y sales volume.

For the cumulative six-month period (6MFY18), the steelmaker's net profit surged about 15 times to RM46.59 million from RM2.95 million a year ago, though revenue only grew a marginal 2% y-o-y to RM560.97 million from RM548.25 million.

The stronger 6MFY18 earnings was mainly because of lower income tax, and finance costs, as well as a RM6.67 million share of profit from its JV, instead of a share of loss of RM55.42 million.

"The group remains optimistic on the steel industry outlook in Malaysia as it is well supported by strong fundamentals in construction activities," Hiap Teck said.

It added that the group would continue to undertake prudent measures to improve its efficiency on manufacturing costs, procurement strategies and working capital management to sustain its cost leadership in the sector.

Shares in Hiap Teck closed up 1.5 sen or 3.7% today at 42 sen, leaving the group with a market capitalisation of RM560.51 million.