KUALA LUMPUR: KINSTEEL BHD [] saw net profit rise 164.9% to RM22.55 million for the quarter ended March 31, 2010 (1Q10) from a net loss of RM34.76 million previously, due to higher steel prices following stronger demand in line with the global economic recovery.
Revenue rose 22.7% to RM540.40 million from RM440.35 million, while earnings per share were 2.40 sen from loss per share of 3.78 sen previously. No dividend was declared for the period.
"On the back of higher revenue, pre-tax results also improved, thus leading to higher margins overall for the group," it said in its results announcement to Bursa Malaysia Securities on Tuesday.
For the quarter under review, its pre-tax profit was RM36.83 million, versus a pre-tax loss of RM93.29 million a year earlier.
On a sequential basis, revenue rose 38% to RM540.4 million from RM390.9 million in 4QFY09 while pre-tax profit was 29.6% lower quarter-on-quarter from RM52.3 million.
The steel manufacturer said total capital commitments being approved and contracted as at the end of the financial period stood at RM41.2 million.
On its prospects for the year ahead, Kinsteel said domestic and regional steel consumption had been rising in tandem with the rebound in CONSTRUCTION [] activities.
"While prices of both iron ore and steel products have increased significantly since 2009, with the recent volatility in iron ore prices, steel prices are expected to track the volatility accordingly," it said, adding the group would monitor the price fluctuations closely and fine-tune its inventory stocking strategy.
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