Malaysia Smelting Corp sinks into the red with RM31.3m loss in Q3
MAINBOARD-LISTED Malaysia Smelting Corp : NPW 0% (MSC) sunk into the red with a net loss of RM31.3 million (S$9.4 million) for its third quarter ended Sep 30, 2022, reversing the RM28.9 million net profit a year ago. This was despite a growth in revenue.
The net loss was exacerbated by longer-than-expected furnace outage due to logistic delay to secure specialised materials and higher operating costs, MSC said in a Monday (Nov 21) bourse filing. Its revenue stood at RM344.1 million in Q3, compared to RM218.5 million the previous year.
Both the group’s smelting and mining businesses’ performances were dragged down by a sharp drop in tin prices, the tin miner and metal producer said. Average tin prices for the quarter fell by 26 per cent to RM104,700 per tonne from the previous year’s RM141,900 per tonne.
“The decline can be attributed to a myriad of factors including concerns of a global recession which led to lower tin demand, compounded by the intermittent lockdowns in China following its zero-Covid policy,” said MSC.
Its smelting arm posted a net loss of RM46 million for the quarter, against a profit of RM4.9 million last year; net profit for its mining operations fell 72.6 per cent to RM8 million on the back of lower tin prices and a RM4.7 million one-off provision for a legal case settlement.
Loss per share stood at 7.5 Malaysian sen for the period, compared to the 7 Malaysian sen earnings per share in Q3 2021. No dividend was declared for the quarter, unchanged from a year ago.
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MSC’s group chief executive officer Patrick Yong said: “We are strengthening MSC’s foundation to allow us to better address the challenges and withstand external headwinds. Nonetheless, tin’s long-term prospects remain positive as tin has been identified as a key component in emerging technologies, including for lithium-ion batteries for electric vehicles.”
MSC shares closed at S$0.49 on Monday, down 9.3 per cent or S$0.05, before the financial results were released.
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