KUALA LUMPUR (June 28): Hiap Teck Venture Bhd’s net profit surged threefold to RM46.82 million for the third quarter ended April 30, 2024 (3QFY2024), from RM15.03 million a year earlier, driven by a higher share of profit from a joint venture (JV) company. 

Earnings per share for 3QFY2024 improved to 2.69 sen, from 0.86 sen previously. Revenue increased by 7.14% to RM399.68 million from RM373.03 million on higher sales volumes, despite lower average selling prices, according to the company’s filing with the stock exchange. 

Hiap Teck recorded a share of profit from a JV entity of RM37.71 million — compared to a share of loss of RM1.46 million previously — amid better profit margins and increased sales volumes. 

No dividend was declared for 3QFY2024. 

For the cumulative nine months of FY2024 (9MFY2024), Hiap Teck made RM58.82 million in net profit, as opposed to a RM11.69 million net loss a year ago, while revenue rose 11.95% to RM1.27 billion from RM1.13 billion. 

“Malaysia’s steel sector continues to navigate the dual challenges of global steel industry dynamics and the nation’s economic growth prospects. The two-year moratorium on steel investments, in alignment with the New Industrial Master Plan 2030, underscores the need for strategic adaptation to global challenges. Despite these challenges, the resilience of Malaysia’s steel demand will be crucial in mitigating potential adverse effects,” said Hiap Teck. 

Going forward, the company will focus on effective procurement strategies, efficient inventory management, and continuous operational improvement. To date, it has successfully utilised 90% of the new 2.0 million million metric tonnes (MT) blast furnace capacity and completed other auxiliary facilities. 

“Consequently, we anticipate significant revenue growth and notable cost savings from economies of scale in our joint venture entity. Barring unforeseen circumstances, we expect substantial contributions and positive outcomes from this venture in the coming quarters,” the company added. 

Shares of Hiap Teck closed one sen or 2.41% higher at 42.5 sen on Friday, valuing the company at RM733.94 million.