PETALING JAYA: CSC Steel Holdings Bhd registered a net profit of RM12.6 million for the second quarter ended June 30, 2019, a 21.2% rise from RM10.40 million recorded in the corresponding period of the previous year, attributed to slight increase in margins for coated steel products as well as lower marketing and administrative expenses.
Revenue, on the other hand, remained flat at RM343.75 million against RM342.53 million previously, due to lower sales volume and selling prices.
For the first half of the year, the group’s net profit dropped 18% to RM17.21 million from RM20.99 million in the corresponding period of the previous year, while revenue declined 2.2% to RM674.95 million from RM690.25 million.
CSC told Bursa Malaysia that it has identified challenges relating to high raw material costs and the influx of cheap imports as the main factors affecting its business performance.
“As such, the group has adopted the strategy of high volume with low margin to solidify the market share and to effectively compete with the cheap imported steel products,” it said.
Going forward, CSC highlighted that there are various potential factors that may affect Malaysia steel industry such as Malaysia’s new steel policy and government’s revival of some mega infrastructure projects.
“However, the prospect of the construction section in the second half year of 2019 is expected to remain sluggish as certain construction contracts will only be released in early 2020,” it said.
