Posted on 01 Dec 2015
Speaking to reporters after the group’s AGM yesterday, executive director and CEO Azlan Abdullah said that Megasteel Sdn Bhd’s requests for further safeguard duties on imports of hot rolled coils (HRC), the weakening ringgit, higher cost production and the Goods and Services Tax implementation will influence the group’s performance the coming year.
Azlan said the steel industry is still challenging due to the soft market, global economic slowdown and dumping of cheap steel imports.
“Despite the difficult economic environment, we expect to remain positive by managing our cost, getting the best price in raw materials and exploring new markets.”
“We have worked hard and I think we have a quite decent result in the first quarter,” he added.
For the first quarter ended Sept 30, 2015, Mycron recorded a net profit of RM2.83 million, from a net loss of RM2.18 million in the previous corresponding quarter, contributed by higher margin spread between selling and raw material prices in its cold rolled segment and inclusion of profit contribution from its new steel tube operations.
To recap, Mycron had in December last year acquired the entire stake in Melewar Steel Tube Sdn Bhd to consolidate the steel business under Mycron.
Revenue was up 22% to RM131.9 million, compared with RM107.9 million previously, mainly due to the inclusion of the steel tube subsidiary’s first quarter results.
Commenting on the safeguard issue, Azlan hopes that the government will not approve Megasteel Sdn Bhd’s request for safeguard duties on the import of HRC into the country.
In August, Megasteel requested the government impose safeguard duties on the imports of all grades of HRC at the rate of 40%, on top of the existing 15% import duty.
