Malaysia Smelting Corp posts 131% surge in Q3 net profit on rising tin demand

MAINBOARD-LISTED Malaysia Smelting Corp (MSC) posted a 130.8 per cent surge in net profit to RM28.9 million (S$9.4 million) for its third quarter ended Sep 30, up from RM12.5 million a year ago.

The company said that the strong performance comes on the back of higher-than-average tin prices, which hit RM141,915 per metric tonne (MT) in the quarter, 92.5 per cent higher than RM73,708 per MT recorded the year before.

MSC's tin-mining segment recorded profit before tax of RM38.7 million in the quarter, up from S$10 million a year ago on the higher average selling price of tin. Profit before tax in the company's tin-smelting segment fell to RM7 million from RM10.6 million a year ago.

However, revenue for the quarter declined 5.3 per cent to RM218.5 million, from RM230.8 million a year earlier.

The company attributed this to lower refined tin production and tin concentrates production quantities due to the gradual restart of smelting and mining operations during Phase 2 of Malaysia's national recovery plan.

MSC's net profit for the 9 months ended Sep 30 soared to RM54 million; revenue rose 41 per cent in the period to RM821.5 million.

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It noted that while the refined tin production quantity was lower during the period as a result of the Full Movement Control Order (FMCO) 3.0 implemented in Malaysia, higher tin prices negated the effect of lower production and resulted in higher group revenue.

MSC's group chief executive officer Patrick Yong said that the group has done well despite constraints arising from the FMCO. He expects that MSC will continue to benefit from favourable tin prices in the near term as tin demand rises for products such as consumer electronics, photovoltaics and electric vehicles.

He said: "As we move ahead, we will focus on increasing production output and improving efficiencies across the group, while staying vigilant of the Covid-19 developments to maintain business continuity with strict adherence to standard operating procedures."

MSC shares closed up 1.7 per cent or S$0.015 to close at S$0.915 on Friday (Nov 12), before the financial results were released.