Malaysia Smelting Corp’s FY23 net profit eases to RM85.05 million

KUALA LUMPUR: Tin miner and metal producer Malaysia Smelting Corporation Bhd’s (MSC) net profit eased to RM85.05 million in the financial year ended Dec 31, 2023 (FY23), compared to RM98.30 million in FY22.

Similarly, its revenue decreased to RM1.43 billion from RM1.50 billion previously due to lower average tin prices, which fell 13.6 per cent to RM118,100 per tonne compared with RM136,700 per tonne in the prior year, it told Bursa Malaysia. MSC said the tin smelting segment posted a net profit of RM36 million in FY23 from a net loss of RM5.5 million in FY22.

“The earnings turnaround was on the back of higher earnings from increased sales of refined tin derived from tin intermediates, as well as higher sales of by-products, and smelting revenue,” it said.

Meanwhile, it said net profit for the group’s tin mining operations amounted to RM64.4 million versus RM95.1 million a year ago. While tin production remained stable in FY23, financial performance was impacted by less favourable tin price movements during the year, it said.

In the fourth quarter ended Dec 31, 2023, MSC posted a net profit of RM9.37 million, which was a steep decline from RM25.84 million in the same quarter in 2022, representing an earnings per share of 2.2 sen compared to 6.2 sen.

Group chief executive officer Datuk Patrick Yong said FY23 presented a challenging operating backdrop with high interest rates and inflationary pressures, compounded by prolonged geopolitical tensions from the conflict in the Middle East and the Russia-Ukraine war.

“Despite external headwinds, we delivered a resilient set of results in FY23. As we move forward, we remain resolute in executing our strategic plans to streamline operations and enhance efficiencies at MSC,” he said in a separate statement.

He said MSC expects to yield improved operational efficiencies and cost savings of approximately 30 per cent, along with a smaller carbon footprint, after moving its smelting operations to Pulau Indah smelter.

“Meanwhile, we are decommissioning our Butterworth smelter in stages, starting in 2024. As for our tin mining business, our focus is on increasing our daily production and overall mining productivity. To achieve this, we are exploring new tin resources and expanding our mining activities,” he added.

Yong said MSC is committed to delivering sustainable value to its shareholders, and as part of this commitment, the group have adopted a dividend payout policy of at least 30 per cent of net profit, which reflects its commitment to long-term value creation.

The board of directors has proposed a final single-tier dividend of seven sen per share, subject to shareholders’ approval, which would bring the total payout in 2023 to 14 sen or 69 per cent payout. — Bernama