KEDAH: Cable and wire manufacturer Southern Cable Group Berhad has once again delivered an exceptional financial performance, fueled by rising demand for cables and wires amid Malaysia’s expanding infrastructure developments.
The Group’s net profit more than doubled to RM18.5 million in the third quarter ended Sept 30, 2024 (3Q24), compared to RM6.5 million in the corresponding quarter last year.
The higher profit was driven by a 40.1% increase in revenue to RM383.6 million in 3Q24,
from RM273.7 million previously. The growth was fuelled by stronger sales volume of power cables and wires. Additionally, the greater performance was due to improved margins from economies of scale due to increased production volume and a better product mix.
Additionally, the growth was bolstered by an expanded annual production capacity of 46,980 km in the current financial year ending Dec 31, 2024, compared to 40,780 km in the previous financial year.
Notably, the Group’s 3Q24 overseas revenue surged more than quadruple to RM32.4 million, from RM6.5 million previously, driven by robust sales of power cables and wires to the United States (US) amid the increasing construction activities.
Managing director Tung Eng Hai said: “The latest financial result marks our strongest achievement in a single quarter to date. Significant contributions came not only from Peninsular Malaysia but also from East Malaysia and the United States. With the promising demand outlook for power cables and wires, we remain confident in our potential for continued growth.”
Besides that, he added the local construction sector has been particularly active over the past year, driven by increasing investments in data centres, industrial buildings, and upgrades to the national grid to meet rising power demands.
“To sustain our growth momentum, we plan to expand our cable and wire product offerings for both the local and US markets. Additionally, construction of a new production facility in 2025 on the recently acquired industrial land is expected to expand our revenue once completed. These initiatives are poised to elevate Southern Cable to the next stage of growth in the coming years,” said Tung.
The Group’s orders in hand stood at RM699.3 million as at Sept 30, 2024 and are expected to be fulfilled by 2026. These orders include supplying underground cables and conductors to power utility companies, rectifier and battery systems to a major telecommunications company, and purchasing orders from Engineering, Procurement, Construction, and Commissioning (EPCC) contractors.
In the nine months ended Sept 30, 2024 (9M24), the Group’s net profit more than doubled to RM47.1 million, from RM17.0 million in the same period last year, attributed to improved margins from economies of scale and better product mix. The rise was on the back of a 35.4% higher revenue of RM1.0 billion compared to RM746.5 million previously, resulting from increased sales volume of power cables and wires.
Meanwhile, the Group has declared a first interim dividend of 0.75 sen per share in respect of the financial year ending Dec 31, 2024, with the dividend ex-date on Dec 11, 2024 and payment date on Dec 18, 2024. The dividend payout amounts to RM6.6 million.
Tung said: “The robust results underscore Southern Cable’s dedication and the resilience of our operations in meeting market demands and driving profitability. With the dividend declared to our shareholders, we aim to reaffirm our commitment to creating value and sustaining positive momentum.”
