KUALA LUMPUR (Aug 25): MSM Malaysia Holdings Bhd (KL:MSM) said it remains actively engaged with the government to finalise a pricing framework and implement import controls on refined sugar, as the group went into the red in the second quarter. 

The “Gula Prai” maker said in a press statement that the measures are critical to safeguarding national food security and ensuring the viability of Malaysia’s sugar industry.

“The sugar industry is expected to remain challenging in 2025, driven by sustained high input costs and volatile raw sugar prices amid fluctuating global production volumes," MSM acting group chief executive officer Hasni Ahmad said.

After two consecutive quarters of profit, MSM posted a loss of RM29.74 million for the second quarter ended June (2QFY2025), narrowing slightly from RM32.39 million a year earlier.

Despite 18% lower production costs on weak raw sugar prices, lower freight costs and better foreign exchange rates, other operating expenses surged year-on-year to RM7.37 million from RM122,000, alongside a 14.5% rise in selling, distribution, and administrative costs.

Revenue for 2QFY2025 declined 2% year-on-year to RM813 million from RM833 million, mainly due to lower average bulk selling prices, despite higher sales volumes.

Capacity utilisation slipped to 49% from 50% in the same quarter last year, reflecting production curtailments to manage inventory across its two refineries. Operational efficiency yield, however, remained stable.

For the first half of 2025, MSM posted a net loss of RM26.02 million, reversing from a net profit of RM9.32 million a year earlier, as total revenue fell 10.2% to RM1.56 billion from RM1.74 billion.

Ahead of the festive-driven demand peak towards year end, MSM's Hasni said the group "continues to reinforce its domestic footprint, mitigate export pricing pressures, and tap into value-added product opportunities". 

"We are also streamlining and optimising operations to ensure profitability,” he added.

By Monday’s midday break, MSM shares were unchanged at RM1.02, giving the group a market capitalisation of RM717 million. Year to date, the stock has declined by 13.6%.