KUALA LUMPUR (June 4): Press Metal Aluminium Holdings Bhd’s net profit for the first quarter ended March 31, 2020 fell 11% to RM102.57 million from RM115.11 million last year, as revenue declined due to lower aluminium prices during the quarter.

Revenue retreated 16% to RM1.83 billion from RM2.17 billion, its stock exchange filing on Thursday showed.

The group declared a first interim dividend of one sen per share, which amounts to a payout of RM40.38 million, to be paid on July 3.

In a statement, Press Metal Group Chief Executive Officer Tan Sri Paul Koon said aluminium demand and prices were impacted following reduced economic activities and shutdowns of industries following the escalation of the COVID-19 pandemic worldwide.

“However, we have partially locked in some favourable pricing from our forward hedging, which mitigated some of the impact from the prevailing low-price environment.

"We expect a recovery in prices should the situation improve without a new wave from the virus spread. Prices of key raw materials such as alumina have also normalised to a more reasonable level compared to 2019. The movements of the US dollar and Chinese renminbi (RMB) also worked in our favour, as our sales are denominated in US dollar and carbon anode is purchased in RMB,” he said.

Hence, despite the temporary setback due to the pandemic, Koon is confident of the group’s low-cost model and remains committed to execute their expansion plans.

“We are targeting to commission our Phase 3 smelter in January 2021, [that will] increase our capacity by 42% from 760,000 up to 1,080,000 tonnes per annum. The progress of our investment in the PT Bintan alumina refinery is also moving as planned and we expect the commissioning of Phase 1 by end of 2020,” he said.

Press Metal shares closed 11 sen or 2.63% higher at RM4.30, giving it a market capitalisation of RM17.36 billion.