KUALA LUMPUR (Sept 27): Steelmaker Hiap Teck Venture Bhd narrowed its net loss to RM19.98 million in the fourth quarter ended July 31, 2018, from RM137.87 million a year earlier, due to lower operating costs.
Revenue came in 42.5% higher at RM325.32 million, from RM228.28 million previously, underpinned by higher sales across all divisions, the group said in a filing with Bursa Malaysia.
Hiap Teck said the trading division reported a 58% increase in revenue to RM157.61 million, from RM99.44 million a year ago, whilst the manufacturing segment’s revenue rose 28% to RM173.95 million, from RM135.56 million.
In line with the improved performance, the group’s profit from operations jumped 68% to RM35.17 million from RM20.98 million previously.
However, the group reported an overall net loss as a result of the share of loss at its joint venture of RM42.35 million, attributable to higher unrealized foreign exchange losses and additional costs associated with the resumption of production at entity level.
The joint venture, Eastern Steel Sdn Bhd, resumed production on July 16 and is currently operating at full capacity, said Hiap Teck.
The group has proposed a first and final dividend of 0.5 sen per share.
For the full financial year, Hiap Teck posted a net profit of RM27.95 million, against a net loss of RM102.98 million in the previous year, as revenue grew 5.05% to RM1.13 billion from RM1.07 billion.
Going forward, Hiap Teck expects steel demand in Malaysia to remain soft this year.
However, it is confident that Eastern Steel will contribute positively to its future performance by tapping on the demands for its products in Malaysia and the regional growth markets of Asean.
Hiap Teck’s shares price rose two sen or 5.13% to close at 41 sen today, giving it a market capitalisation of RM548.87 million.