KUCHING: Cahya Mata Sarawak Bhd’s (CMS) quarterly earnings have been bolstered by strong cement sales and supply of steel pipes to a government water project.
In the third quarter to Sept 30, 2014, the Sarawak conglomerate group’s pre-tax profit shot up to RM104.2mil, an increase of RM41.7mil or 67% from RM62.5mil a year ago on the back of higher revenue of RM413mil against RM335.4mil previously. Earnings per share improved to 6.97 sen from 4.03 sen.
CMS said the cement division delivered a 13% increase in pre-tax profit to RM33.7mil from RM29.7mil in the previous corresponding period, thanks to higher sales and cement prices following the upward adjustment in February this year.
The construction materials and trading division’s pre-tax profit soared by 61% to RM21.7mil from RM13.5mil previously due to the supply of mild steel polyurethane pipes to Public Works Department and higher premix sales volume for the road maintenance programme. The division’s performance was boosted by the recovery of RM2.72mil in bad debts by the wire business.
The property development division’s pre-tax profit soared to RM6.8mil from RM461,000 previously. The construction and road maintenance division recorded marginal increase in its operating profit to RM21.1mil from RM20.2mil.
On a nine-month basis, CMS group’s pre-tax profit surged by RM82.8mil to RM269mil from RM186.2mil a year ago as revenue jumped to RM1.17bil from RM984mil.
CMS group managing director Datuk Richard Curtis said in a press statement that as the third and fourth quarters were typically the company’s strongest in financial performance, the group could expect strong results for the full year.
He attributed the company’s remarkable performance to its focus on delivering long-term sustainable growth, prudent business model and pforessional management.
Curtis said Sarawak’s efforts to promote energy-intensive industries under Sarawak Corridor of Renewable Energy (Score) initiative and development of infrastructure and related services across the state were set to propel CMS to new heights.
He said the company’s healthy balance sheet would allow CMS to maximise its participation in Sarawak’s growth story and position itself for long-term sustaible growth.
CMS’s current participation in Score projects includes a 20% stake in OM Materials (Sarawak) Sdn Bhd, which owns a ferroalloy smelting plant in Samalaju Industrial Park. The plant commenced its phase I production of ferro silicon alloys two months ago.
CMS has a 40% stake in a proposed joint-venture integrated phosphate products complex project in Samalaju with parnters Malaysian Phosphate Additives Sdn Bhd and Arif Engima Sdn Bhd.
Meanwhile, CMS has raised the net payout ratio of its annual consolidated profit after-tax and non-controlling interests to shareholders to 40% from 30%. The revised dividend policy is, however, subjected to a minimium 2 sen per share payout and other considerations, such as the level of available cash and cash equivalents, return on equity and retained earnings and projected levels of capital expenditure and other investment plans.