The company's revenue declined by 8% year-on-year RM416.6mil mainly due to lower average selling prices.
PETALING JAYA: Hiap Teck Venture Bhd
has cautioned against a challenging global steel market, particularly in China due to weak domestic demand that is driving increased exports.
For the fourth quarter ended July 31, 2024 (4Q24), the steel company’s net profit rose by 11% year-on-year (y-o-y) to RM47.5mil or earnings per share of 2.73 sen. Its revenue however declined by 8% y-o-y to RM416.6mil mainly due to lower average selling prices.
For the financial year 2024 (FY24), Hiap Teck’s net profit surged by 244% y-o-y to RM106.3mil while revenue increased by 6% y-o-y to RM1.7bil, driven by higher sales which helped offset the impact of lower prices.
In a filing with Bursa Malaysia yesterday, the company pointed out that for the quarter, its profit from operations decreased to RM6.9mil from RM25.7mil, primarily due to the downward trend in steel prices, which compressed profit margins, along with an inventory write-down of RM1.7mil.
For FY24, profit from operations surged to RM62.50mil from RM4.25mil last financial year, driven by stable steel prices in the 2Q24 and 3Q24, improved margins and sales volumes.
Revenue from its trading division fell by 16% to RM216.6mil in FY24 from RM257.38mil in FY23 due to reduced sales volumes.
In contrast, the manufacturing division recorded a 14% on-year growth in revenue in FY24, reaching RM197.3mil, supported by higher volumes.
Hiap Teck said the local steel industry is expected to be supported by the government’s New Industrial Master Plan 2030.
It has recommended a dividend of 0.5 sen per share subject to the approval of its shareholders at the next AGM.
