KUALA LUMPUR (Aug 29): Press Metal Aluminium Holdings Bhd (KL:PMETAL) said on Thursday its net profit surged 65% in the second quarter thanks mainly to higher price sold and stronger US dollar that boosted export receipts.
Net profit for the three months ended June 30, 2024 (2QFY2024) was RM505.83 million compared to RM305.79 million over the same period a year earlier, Press Metal said in an exchange filing. Revenue for the quarter rose 5.2% year-on-year to RM3.95 billion from RM3.76 billion.
Apart from macroeconomic uncertainties, rising alumina prices from temporary supply interruptions are lifting costs, Press Metal flagged, “though we anticipate these pressures to ease by year end as supply normalises”.
“We remain optimistic about aluminium's long-term prospects as economic conditions improve,” said chief executive officer Tan Sri Paul Koon.
Aluminium prices on the London Metal Exchange have declined about 9% from this year’s high of US$2,767.50 (RM11,930.49) per tonne on May 29 but are still up more than 6% year-to-date thanks to supply constraints from sanctions on Russian as well as demand growth from China.
The cost of alumina, meanwhile, has risen due to shortages of the essential feedstock in China since the start of 2024, helping to keep aluminium prices elevated.
Net profit at Press Metal, Southeast Asia’s largest aluminium smelter by capacity, has climbed 55% to RM913.87 million in the first half of 2024 compared to RM587.76 million in the same period in 2023. Revenue rose 11% to RM7.57 billion from RM6.83 billion.
“Our strengthened financial position enables us to capitalise on the opportunities arising from the ongoing shift towards renewable energy and the relocation of manufacturing to Southeast Asia,” Press Metal said. “We remain optimistic about aluminium's long-term prospects as economic conditions improve.”
The company has also declared an interim dividend of 1.75 sen per share, amounting to total payout of RM144.2 million, payable on Sept 30.
Shares of Press Metal edged up 0.4% to RM5.15 ahead of the results announcement, giving the company a market capitalisation of RM42.43 billion.