Choo Bee Metal net profit climbs to RM10.2mil

PETALING JAYA: Choo Bee Metal Industries Bhd has registered a net profit of RM10.2mil for the second quarter ended June 30, bringing its first-half net profit to RM20.66mil.

This represents an increase of 62.5% and 15.7%, respectively, as compared to the corresponding period last year.

According to a Bursa Malaysia filing, the higher net profit recorded was mainly attributed to the greater contribution from the trading segment due to an increase in demand, as well as higher average selling prices, which strengthened profit margins.

“Steel demand is expected to benefit from the strengthening recovery in investment levels and commodity prices, both in developed and developing economies.

“However, the rising United States-China trade tension, and probable US and European Union monetary policy changes could erode this momentum, although there is no discernible impact yet. Over the past month, new players have also been seen entering the Asean regional market, as exporting mills scour for new markets as a substitute to the US,” said Choo Bee.

The group added that the domestic market would be challenging due to the new Pakatan Harapan government’s economic policy changes, as well as austerity measures to curb excessive expenditure, which has seen some major infrastructure projects being terminated or downsized.

“We expect this scenario, which will affect steel demand to be temporary, as such measures are believed to augur well for the future and will place the country’s economy on a firmer footing,” said Choo Bee.