MSM’s 2Q revenue up 9.2% on better sales


MSM Malaysia Holdings Bhd posted a 9.2% increase in revenue to RM692.46 million year-on-year (YoY) for the second-quarter ended June 30, 2017 (2Q17), against RM633.86 million previously.

In a filing to Bursa Malaysia yesterday, the leading refined sugar producer attributed its higher revenue growth to improved selling price and higher volume of refined sugar sold in the domestic market segment.

MSM — which is also a subsidiary of Felda Global Ventures Holdings Bhd — recorded a RM1.34 billion revenue for the first-half of 2017, compared to RM1.19 billion in the corresponding period of the preceding year.

MSM saw a loss after tax of RM21.45 million for the period under review against profit after tax of RM23.68 million in the same period a year ago, due to higher raw material costs and the weakening of
the ringgit.

MSM said results are expected to improve in the near term with the replacement of stocks of raw sugar material at the current lower raw sugar market price — though commodity prices have been volatile.

MSM saw a 2.4% increase in profit margin for 2Q17 against 1Q17, driven by a sales spike during the Hari Raya festive season.

Taking into consideration that 80% of its operating costs is highly dependent on global market price of raw sugar and the foreign-exchange rate, the quarterly profit margin improvement is a clear sign of confidence that the company is focused on growing its market share penetration strategies, the statement said.

MSM group CEO and president Mohamad Amri Sahari said in the months ahead, the company expects to see some improvement to offset the residual impact of procuring raw sugar at an all-time high the previous year.

“Our financial performance is strictly dependent on movements in the global commodity markets,” he said.

Mohamad Amri said MSM’s strong fundamentals are supported by sales revenue growth of 13.6% in 2Q17, as the firm continues to demonstrate the value of and integrated business model.

“We remain focused on cost savings initiatives to improve the overall profitability and cashflow to maintain sustainable value to shareholders,” he said.

MSM is looking to expand its portfolio further by ensuring the completion of the Johor refinery remains on track, with physical construction completion standing at 54% as at June 30 this year and still within the stipulated budget, he added.