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Nico Steel expects 'significant increase' in FY2019 profit

METALS supplier Nico Steel Holdings is expecting a "significant increase" in net profit for the full year ended Feb 28, 2019 due to stronger operating results.

In its profit guidance issued on Friday, the company also said that it expects second-half net profit to be higher than the US$121,000 earned in the first half of its fiscal year.

For the year ended Feb 28, 2018, Nico Steel posted a net profit of US$34,000.

"The ongoing trade dispute between the United States and China that started in July 2018, the global economic slowdown, and the delay in the 5G network implementation adversely affected our customers’ plans for new mobile device projects and launches. Nevertheless, the expected increase in the unaudited consolidated profit attributable to shareholders for FY2019 is primarily due to an improvement in the operating results of the group," the company said.

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Looking ahead, Nico Steel said that the coming transition to 5G telecommunication networks will continue to drive the upgrading cycle for mobile devices.

"This bodes well for the group's value-creation strategy in its core metallurgical solutions – a proprietary range of alloys with registered trademarks and customised solutions, to meet evolving requirements for metal components in mobile devices," the company said.

The company expects to release its full-year results by April 30.

Shares in Nico Steel were trading at 0.5 Singapore cent as at 9.26am on Friday after the announcement, unchanged on the day.