MSM Malaysia returns to the black in Q1

KUALA LUMPUR: MSM Malaysia Holdings Bhd (MSM) returned to the black in the first quarter ended March 31, as it delivered a net profit of RM15.80mil against a net loss of RM34.62mil recorded in the previous comparable period.

The improved performance was attributable to lower raw material costs and favourable foreign exchange rate, said MSM.

The reduction in administrative expenses by 33% quarter-on-quarter, or RM9.1mil from RM23.8mil was also one of the contributing factors to MSM's performance.

Revenue, however, slipped 14.2% to RM549.06mil from RM640.04mil recorded during the same quarter last year amid a 7% reduction in the overall tonnage sold and lower average selling price.

“While the circumstances were unfavourable in 2017, the first quarter performance shows encouraging signs towards a healthy balance sheet.

“It certainly is a continuous turn-around process and on this positive note MSM’s direction is firm to reinforce its leading role in this business,” said MSM executive director Datuk Khairil Anuar Aziz in a statement yesterday.

MSM was strengthening its operational focus by marking down its raw sugar cost by 23.1% against the first quarter 2017.

This, however, was hampered by an increase in the average refining cost due to higher fuel cost which resulted from an upward revision of the gas tariff in January by 16%.

Among others, he said the Johor refinery was slated for commissioning in the first half of 2018 and continued to be budget prudent and in accordance with the timeline.

The statement also said capacity growth was focused towards producing better margin and revenue via export sales improvement, particularly in South-East Asia and the Middle East and North Africa markets. — Bernama