MMC Corp’s 1Q net profit rises 8% on higher port contribution

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KUALA LUMPUR (May 20): MMC Corp Bhd’s net profit rose 8.16% to RM57.88 million for the first quarter ended March 31, 2020 (1QFY20), against RM53.52 million previously, thanks to higher contributions from the Port of Tanjung Pelepas and Johor Port Bhd.

It also recorded a higher share of contributions from its associates, namely Malakoff Corp Bhd and higher interest income, as well as lower operating expense for the Klang Valley Mass Rapid Transit (MRT) Sungai Buloh-Serdang-Putrajaya Line, according to a bourse filing.

Earnings per share rose to 1.9 sen from 1.8 sen a year ago.

Revenue however fell 4.4% year-on-year to RM1.09 billion, compared with RM1.14 billion, due to lower work progress for underground work packages for the Klang Valley MRT Sungai Buloh-Serdang-Putrajaya Line, lower volume handled at Northport and a lower contribution from Kontena Nasional Bhd.

These were however cushioned by higher volume handled at the Port of Tanjung Pelepas and Johor Port, it said.

In a statement today, MMC said it acknowledges the challenging business environment this year — due to global economic contraction arising from the Covid-19 pandemic — and expects it to remain challenging in the short to medium term.

“The board will continue to monitor the situation closely and focus on resource optimisation to reduce its operating cost in line with the challenging economic outlook.

“We are committed to strengthening our market position by focusing on operational performance and efficiency and capability improvements, while exploring new opportunities,” said MMC group managing director Datuk Sri Che Khalib Mohamad Noh.

Segmentally, MMC said its ports and logistics division will focus on resource optimisation amid uncertainty over the global container volume outlook.

This will also be supported by continuous vigilant investment in the ports’ infrastructure, capacities and capabilities along with operational efficiency and group-wide cost synergies initiatives, it said.

Meanwhile, the energy and utilities division is expected to provide consistent earnings to the group with contributions from its associated companies Malakoff and Gas Malaysia Bhd.

MMC ended 2.5 sen or 3.42% higher at 75.5 sen today, valuing it at RM2.3 billion.