KUALA LUMPUR (May 15): Having posted a 34.2% drop in first-quarter net profit, chemical supplier Samchem Holdings Bhd (KL:SAMCHEM) expects a more challenging operating environment in 2025 due to global trade disruptions, volatile foreign exchange rates and rising oversupply in the industry.

For the first quarter ended March 31, 2025 (1QFY2025), Samchem reported a net profit of RM4.01 million or 0.74 sen per share in earnings per share, down from RM6.10 million or 1.12 sen per share in the same quarter a year ago, the group said in a filing with Bursa Malaysia on Thursday.

Revenue was also down 3.5% year-on-year (y-o-y) to RM287.76 million from RM298.24 million, mainly due to a decrease in average selling prices.

No dividend was declared for the quarter under review.

Looking ahead, Samchem said increasing production capacity in China has worsened oversupply conditions, placing further pressure on prices and margins across the region.

“Despite these headwinds, we are positioning the group to benefit from shifting trade flows and supply chain realignments through targeted expansion, infrastructure investment and operational agility,” it noted.

Samchem — which distributes industrial chemicals and provides blending services for customised solvents — emphasised its commitment to capital discipline and strategic growth opportunities that enhance long-term resilience and market positioning.

Of its operating markets, only Indonesia recorded revenue growth of 70% to RM23.13 million. Malaysia, Vietnam and Singapore, however, saw declines in top line by 7%, 6% and 31% to RM145.29 million, RM114.34 million and RM5 million, respectively.

Samchem’s shares closed half a sen or 1.27% lower at 39 sen on Thursday, giving it a market capitalisation of RM212.16 million. The stock has fallen more than 20% year-to-date.