Posted on 28 Apr 2017
Southern Steel Bhd has proposed a three sen dividend, after posting its third consecutive profitable quarter, on the back of better selling prices and higher productivity.
In its third quarter ended March 31, 2017 (3QFY17), net profit came in at RM31.87 million or 7.54 sen a share, compared with a net loss of RM8.99 million or 2.14 sen posted in the same period last year, as revenue grew 12% to RM665.91 million from RM595.85 million.
The dividend is set to be paid on June 1, the company's bourse filing today showed.
For the nine-month period ended March 31, 2017 (9MFY17), Southern Steel’s net profit stood at RM87.73 million, far from the RM108.48 million in losses it registered in the corresponding period last year, again due to the same reasons behind its quarterly earnings improvement.
Revenue rose 9.59% year-on-year to RM1.98 billion from RM1.81 billion previously.
But looking forward, the steel maker expects selling price to remain low, on the back of weak demand, excess industry capacity and intense domestic competition.
The government’s final decision to retain safeguard duties on steel bar and wire rod for three years beginning April 2017, however, will help reduce excessive dumping and unfair trade, said the company.
Southern Steel was in the red in FY15 and FY16, burdened by lower exchange rates, price competition and steel dumping practices prior to the renewed safeguard duty by the government last year.
Its shares settled unchanged at RM1.39 today, giving it a market capitalisation of RM589.06 million.
