KUALA LUMPUR: After enjoying annual profit growth over the last five financial years, Perusahaan Sadur Timah Malaysia Bhd
(Perstima) would be hard-pressed to do the same this year based on the 74.6% drop in its half-year net profit.
In a filing with Bursa Malaysia on Monday, the tinplate producer said it only earned RM3.51mil in the second quarter ended Sept 30 compared with RM13.25mil a year ago despite a 17.5% jump in revenue to RM234.34mil.
Higher selling price on lower sales volume led to improved revenue, but despite the higher prices, its profit margin shrank due to higher production cost; hence the lower profit, it said.
Perstima said it was unable to fully pass on the higher production cost to customers in order to maintain price competitiveness.
For the first six months of the year, Perstima’s net profit fell to RM6.35mil from RM25.04mil in the corresponding period of last year.
On the company’s prospects for the year ending March 31, 2018, it said its board expected the operating environment to remain challenging and competitive due to greater presence of imports from overseas, in addition to the volatility of the ringgit against the US dollar.
“Although these factors will affect the growth and profitability of the group, the management will continue with its cost-saving measures and sales and marketing efforts in order for the group to be profitable,” it added.
The directors did not declare any interim dividend (previous corresponding period: 20 sen).
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