Press Metal Aluminium Holdings Bhd, the largest integrated Aluminium producer in South East Asia, announced that its net profit rose 81.1% to RM298.2 million, from RM164.6 million (after adjusting for insurance claim) a year ago.
The significant increase was mainly attributable to additional production output generated by its Samalaju phase 2 smelting plant and higher metal price.
Revenue was up 31.1% to RM2.08 billion for 2Q17, from preceding year’s corresponding quarter’s (2Q16) revenue of RM1.59 billion. Profit before tax (“PBT”) increased by RM10.2 million or 5.1% to RM209.4 million in 2Q17 from RM199.2 million in 2Q16.
However, 2Q16’s PBT was inclusive of an interim insurance claim of RM45.0 milliom. Excluding the insurance claim, the core business PBT for 2Q16 would be RM154.2 million and indicating an increase of core business PBT of 35.8% or RM55.2 million in 2Q17.
The prospect for the business in 2Q17 was uplifted by the Aluminium price which saw a 2.8% increase from an average of USD1,852 per metric ton in 1Q17 to an average of USD1,905 per metric ton in 2Q17.
The increase in Aluminium price was driven up by the curtailment policy from China due to pollution concern surrounding Beijing. As such, the market is expecting that the demand and supply for the year to tilt towards a deficit situation.
Commenting on the results, Group Chief Executive Officer, Datuk Paul Koon said: “We are very pleased of our record profit in the first half of 2017, which is our first year running on designed smelting capacity of 760K tonnes per annum. We are continuing our efforts to enhance plant efficiency and expand on our value added product lines to further increase our margins.”
“We expect the commissioning of Samalaju Port and the shortened distance of the new coastal road from Mukah to Bintulu Port to have positive impact to our profitability moving forward. With this, we will further maximize efficiency and reduce inland transport costs by installing a conveyor belt linking our smelter directly to the Samalaju Port which is expected to be operational by end 2017.
We are very excited about Aluminium industry latest developments, especially on China’s supply reform.”