KUALA LUMPUR (May 15): Cahya Mata Sarawak Bhd (CMSB) saw its net profit surge over 21 times to RM22.66 million or 2.11 sen per share for the first quarter ended March 31, 2017 (1QFY17), from RM1.05 million or 0.1 sen per share a year earlier.

Revenue for the quarter declined 19% to RM282.3 million from RM346.91 million in 1QFY16.

The group attributed the improvement in profit to a reduction in the share of losses in associates, which had impacted its earnings in 1QFY16, increase in share of profits from joint ventures and better performance of the cement division and construction and road maintenance division.

CMSB said the construction and road maintenance division saw higher recognition of profits upon closing of certain projects, while the cement division saw lower handling costs and cheaper imported clinker.

"The group also recorded a higher share of profit of RM11.44 million in 1QFY17 from the share of results of its joint ventures in comparison to 1Q16's profit contribution of RM1.64 million.

"The increase was mainly attributable to the excellent performances by a private equity management company and two private equity funds," it said.

Meanwhile, CMSB saw lower loss of RM4.13 million during the quarter from the share of results of its associates, an improvement from RM16.16 million in losses in 1QFY16, as OM Materials (Sarawak) Sdn Bhd performed better during the quarter.

The group expects OM Materials to see better days in the second half of 2017 up to 2018, backed by expected demand growth and price improvements.

"Overall, the results for 1QFY17 are viewed positively as they reassure that the group is on track towards a much-improved performance for our FY2017 financial results as against FY2016," said CMSB group managing director Datuk Richard Curtis in a statement.

He said the group is poised to benefit from the growing infrastructure needs in Sarawak, adding that the projected improvement in the global and Malaysian economies would also bode well for CMSB.

"We believe that CMSB continues to be one of the best proxy listed investments for Sarawak's economic growth.

"This is consistent with the state's promotion of energy-intensive industries under the Sarawak Corridor for Renewable Energy (SCORE) initiative, its rural transformation plans, its focus towards establishing a digital economy and the infrastructure and related services that will therefore be required across the state," he added.

CMSB's share price closed up 9 sen or 2.04% at RM4.50, giving a market capitalisation of RM4.81 billion.