Cahya Mata Sarawak 4Q net profit down 90%

Malaysia’s Cahya Mata Sarawak Bhd’s (CMS) net profit declined 90 per cent to MYR5.4m (US$1.28m) in the fourth quarter ended 31 December 2019, compared to MYR53.5m in the 4Q18. Profit before tax decreased 76 per cent YoY to MYR20.2m in the 4Q19 from MYR83.1m in the 4Q18.

CMS revenue in the 4Q19 also fell eight per cent YoY to MYR456.5m from MYR496.8m reported in the 4Q18.

The reduced performance was attributed to its cement, construction, road maintenance and property development business.

Full-year 2019
For the 2019 financial year, the company reported a 39 per cent net profit decline to MYR160.3m (2018: MYR262.1m).

CMS group Managing Director, Datuk Isaac Lugun, said the group reported a revenue of MYR1.74bn for FY19, up two per cent compared to MYR1.71bn in FY18 as a result of a significant decrease in aggregate contribution from associate companies.

“Lower operating profits from CMSB’s traditional core business divisions namely cement, construction and road maintenance, and property development also impacted FY19 performance,” he said in a statement yesterday.

CMS cement revenues advanced eight per cent to MYR601.62m YoY, but profit before tax declined 19 per cent to MYR73.11m due to increased production costs, particularly scheduled maintenance and higher raw material prices. Imported clinker prices have increased on the back of higher regional demand and reduced supply from China.

Outlook
CMS is well-positioned to benefit from all key economic drivers in Sarawak and is supported by a healthy balance sheet and a three-prongued growth strategy, according to Mr Lugun. “Specifically, this strategy calls for CMSB to firstly, reposition and fortify all traditional core businesses, secondly, to fully implement and grow the strategic businesses and, lastly, to reposition and strengthen the CMS brand,” he said.