MSC second-quarter earnings at RM28.45mil

PETALING JAYA: Malaysia Smelting Corp Bhd (MSC) is maintaining a cautious front and will continue to focus on operational efficiencies.

In a filing with Bursa Malaysia, the integrated producers of tin metal and tin-based products said it would also continue to focus on improvements on all areas of operations, technology, manpower and logistics in its smelting and mining business segments.

“The current tight monetary policy and high inflationary environment continue to put pressure on the global economy, with moderating growth prospects likely for the remaining second half of 2023 and early 2024,” it said.

For its second quarter ended June 30, 2023, MSC’s net profit dropped to RM28.45mil from RM39.45mil in the previous corresponding period.

Revenue, meanwhile, was lower at RM327.01mil compared with RM408.84mil a year earlier.

Basic earnings per share stood at 6.80 sen versus 9.40 sen previously.

MSC said its tin smelting business recorded a net profit of RM16.3mil during the quarter under review, driven by higher profits from increased sales of refined tin derived from processed tin intermediates, by-products, and smelting revenue.

“Meanwhile, the tin mining segment posted a net profit of RM17.2mil in the second quarter ended June 30, 2023.

“Earnings were affected by softer average tin prices of RM116,500 per tonne, versus RM158,900 per tonne in the second quarter of the previous financial year.”

For the six-month period ended June 30, 2023, MSC’s net profit dropped to RM63.86mil from RM103.79mil a year earlier, while revenue fell to RM667.07mil from RM768.31mil previously.

Commenting on the group’s performance, MSC group chief executive officer Datuk Patrick Yong said MSC achieved higher volumes of refined tin production and increased tin mine output in the first half of 2023, compared with the first half of 2022.

“However, our performance was offset by the less favourable tin price movements, which averaged 31% lower at RM116,300 per tonne in the first half of 2023.

“As we move forward, we are committed to improving operational efficiencies across all aspects of our smelting and mining business segments.”

At the Pulau Indah smelter, Yong said MSC is looking forward to higher yields with lower carbon footprint, as well as lower manpower and energy costs, using the more efficient top submerged lance furnace.

“With the planned decommissioning of the Butterworth plant in 2024, we expect to achieve cost savings of up to 30%.

“Until then, there is a duplicate of expenses with both plants running.”

For our mining division, Yong said the group remains focused on enhancing daily mining output and overall productivity at its Rahman Hydraulic tin mine in Klian Intan.

“Our efforts include exploring new tin mine resources to expand our mining activities.

“Through these strategic initiatives, we remain steadfast in our commitment to sustainable growth, while building a solid foundation for MSC to address challenges and capture emerging prospects.”