KUALA LUMPUR: Choo Bee Metal Industries said its net profit in the first quarter swelled as the shortage of raw materials pushed up steel prices higher.
For the three-month ended March 31, the company posted a net profit of RM27.3mil, or 20.9 sen a share compared with RM3.6mil (2.8 sen a share) made a year ago.
Revenue was up 80% to RM136mil.
Global steel prices have soared as iron ore continued to record protracted highs.
Choo Bee said further impetus driving steel prices were attributed to stronger demand led by China, yet steel supply remains inadequate due to logistics delays (global container shortage) and mill capacity issues attributed to the Covid-19 pandemic.
The company expects local steel prices to remain high.
"Despite lower construction activities impacting demand, profit margins have expanded in tandem with the heightened prices by all manufacturers," Choo Bee said.
"The revival of the construction sector and governmental infrastructure spending (Mass Rapid Transit Line 3 (MRT 3), Klang Valley First Phase Double Tracking Project, etc) remains crucial to drive demand growth for the local steel industry," it added.