Lion Corp's 2QFY15 loss widens to RM123.3 mil, cites foreign steel dumping as major concern

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KUALA LUMPUR (Feb 26): Lion Corporation Bhd (Lion Corp) saw its net loss widened to RM123.31 million or 9.37 sen a share in its second quarter ended Dec 31, 2014 (2QFY15) from RM33.18 million previously, due to sluggish demand in the domestic steel market.

Revenue in 2QFY15 also decreased 35.42% to RM474.28 million, from RM734.38 million, its filing with Bursa Malaysia showed.  

For the first half of the financial year 2015 (1HFY15), Lion Corp’s (fundamental: 0; valuation: 0.3) net loss grew to RM209.24 million, from RM132.02 million, while revenue fell 11% to RM1.08 billion, from RM1.21 billion.

The group attributed the sluggish demand in the domestic steel market to rampant dumping activities by foreign steel players, which it said remained a major market disturbance.

“Despite the imposition of Provisional Anti-Dumping Duty measures on hot rolled coils by the government in October 2014, the performance of the group continued to be affected by the fact mentioned above,” it said in a statement.

Meanwhile, it noted its property division reported lower progress billings for the period under review, whilst contribution from the furniture division remains negligible to the group.

Lion Corp said pending the effectiveness of the Anti-Dumping Duty measures by the government, the operating environment for its steel business is expected to remain challenging in the coming quarter.

However, it maintained that the property and furniture divisions are expected to sustain their moderate performance.

Lion Corp closed unchanged at 6 sen today, with a market capitalisation of RM78.97 million.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)