Posted on 29 Aug 2017
Lion Diversified Holdings Bhd (LionDiv) produced an operating profit of RM30.43mil for the financial year ended June 30, 2017 (FY17) after four consecutive years of losses.
While the Practice Note 17 company still ended up with a net loss of RM65.19mil for the year, this loss was a sharp drop from RM840.02mil in the preceding year.
LionDiv’s interim financial report to Bursa Malaysia showed that operating loss from its steel product manufacturing operation had been slashed to RM33.3mil from RM98.07mil in FY16.
The group's property division, which is undertaking a mixed development project on 20.1ha in China’s Jiangsu province, almost tripled its profit (178% growth) to RM55.01mil.
The electronic and mechanical contract manufacturing services (CMS) division reported a 32% lower operating profit of RM14.73mil for the year.
LionDiv's revenue fell 39% to RM423.6mil mainly due to the absence of contribution from its direct reduced iron (DRI) plant in Banting, which was shut down “temporarily” in February 2016 following weak DRI demand (its products were mostly used by LionDiv’s associate Megasteel Sdn Bhd, which also ceased operations “temporarily”).
For the fourth quarter, the group cut its net loss to RM11.96mil against RM756.89mil a year earlier, while revenue fell to RM69.25mil from RM170.47mil previously.
On its prospects for the coming year, LionDiv said both its property and CMS divisions were expected to maintain their satisfactory performance in the coming year.
As for the steel division’s operations, it said the resumption of its operations would very much depend on the underlying market demand, prices of direct reduced iron and the availability of raw materials.
