KUALA LUMPUR (Feb 19): Malaysia Smelting Corp Bhd returned to the black in the fourth quarter ended Dec 31, 2020 (4QFY20), posting a net profit of RM15.86 million from a net loss of RM15.95 million.

In a bourse filing, the group attributed the improved earnings to higher tin prices and the reversal of written down inventories worth RM21.1 million during the group’s most recent financial quarter.

The company has declared a dividend of one sen per share. For the full financial year ended Dec 31, 2020 (FY20), the tin company’s total dividend declared is one sen per share, from two sen in the previous financial year.

Meanwhile, the group’s revenue grew 27.3% year-on-year (y-o-y) to RM232.57 million in 4QFY20 from RM182.73 million a year prior.

On a quarter-on-quarter (q-o-q) basis, the group saw its net profit increase by 26% to RM15.86 million from RM12.54 million in the immediate preceding quarter. Quarterly revenue was almost flat, barely 1% higher at RM232.57 million from RM230.83 million in 3QFY20.

Annual net profit for FY20, however, slid by 48% y-o-y at RM16.1 million in FY20 from RM30.69 million in FY19. FY20’s revenue was down 17% at RM813.36 million, from RM983.57 million.

In a separate statement, Malaysia Smelting Corp chief executive officer (CEO) Datuk Dr Patrick Yong said that the group’s core operations remain resilient as it continues to execute its ongoing rationalisation initiatives to enhance efficiencies.

“Our plan to fully commission the new smelting facility in Pulau Indah is on track for late-2021 or early-2022. The new smelter is anticipated to significantly increase our production capacity by 50% to 60,000 tonnes per year using the cutting-edge Top Submerged Lance (TSL) furnace, with lower operational costs and carbon footprint. At the moment, testing and commissioning works are being carried out to ensure smooth operations before taking over entirely the smelting activities from the old Butterworth plant,” he noted.

Yong added that it is focused on enhancing its overall mining productivity. He added that at it is exploring new tin deposits in its Rahman Hydraulic Tin mine in Klian Intan, as well as introducing new technologies to increase its daily mining output at the site. Its Sungai Lembing mine has seen minimal activities commencing with minimal average production. To expand its mining activities, Yong added that the firm is looking at exploring joint venture arrangements.

“Looking ahead, we are positive on the outlook of the MSC Group driven by our rationalisation efforts and the interest in the tin industry. For 2021, we are already seeing tin consumption recover with LME 3-month tin price soaring to seven-year highs of US$23,443/tonne in February 2021 as supply strives to meet demand.

Shares in Malaysia Smelting Corp dropped 2.10% or six sen to RM2.80, valuing it at RM1.12 billion. It saw 1.01 million shares transacted.