Masteel to proceed with commuter rail project

PETALING JAYA: Malaysia Steel Works (KL) Bhd (Masteel) has received the green light from the Johor state government to proceed with the rail transit network project in the Iskandar Development Region.

“The company would proceed with the relevant state and Federal Government agencies for the necessary approvals,” said Masteel in a filing with Bursa Malaysia yesterday.

The announcement comes following a local news report on Monday which claimed that the project, which would be undertaken jointly between Masteel and KUB Malaysia Bhd, was unlikely to be approved by the state government.

Masteel had clarified on Monday that it had not received any notification from any ministries or government agencies indicating that the Iskandar commuter rail project “will not take off or will be scrapped or otherwise cancelled.”

Masteel and KUB had entered into a heads of joint venture agreement on Jan 19 to pursue the project in Iskandar, which will be undertaken via a joint venture company, Metropolitan Commuter Network Sdn Bhd.

Meanwhile, Masteel’s net profit for its second quarter ended June 30, was flat at RM10.10mil compared with RM10.13mil in the previous corresponding period, mainly due to a lower margin on a higher sales volume.

Revenue meanwhile increased to RM359.99mil from RM342.26mil, which was mainly attributed to higher sales volume, it told Bursa Malaysia in a separate statement.

For the six-month period ended June 30, net profit increased to RM17.38mil from RM13.68mil in the previous corresponding period, while revenue rose to RM697.67mil from RM672.30mil a year earlier. Masteel said the prospects for the strong flow of orders for the company’s products were expected to be favourable, while the prices for steel bars, billets and scrap were expected to fluctuate within a narrow band.