Malaysia Smelting Corp 4Q net profit plunges 64%, adopts new dividend policy

KUALA LUMPUR: Tin producer Malaysia Smelting Corp (MSC) said on Thursday its net profit fell nearly 64% in the fourth quarter (4Q) from a year earlier, dragged by foreign exchange losses as well as the absence of sale of refined tin from processed tin intermediates and by-products.

Net profit for the three months ended Dec 31, 2023 was RM9.37 million compared with RM25.84 million a year earlier, MSC said in an exchange filing. Revenue however rose 3.5% year-on-year to RM404.63 million from RM391.15 million as tin prices rose. Prices of tin averaged RM116,000 per tonne compared to RM98,100 per tonne in the same three-month period in 2022.

For the full year, MSC’s net profit declined 13.5% to RM85.05 million from RM98.31 million in 2022 while revenue slipped 4.5% to RM1.44 billion from RM1.5 billion.

MSC also proposed a final single-tier dividend of seven sen per share for the quarter, bringing the full-year payout to 14 sen per share, higher than the seven sen per share in the previous year.

In a separate filing, the company said it has adopted a dividend payout policy of at least 30% of net profit. “This policy reflects our commitment to long-term value creation… while allowing us to reinvest in strengthening the company,” said chief executive officer Datuk Dr Patrick Yong.

Going forward, Yong said the company is exploring new tin resources and expanding its mining activities to increase daily production and overall mining productivity, while continuing to streamline operations and enhance efficiencies.

At its smelting business, the company noted that the move to the Pulau Indah smelter is expected to result in savings of about 30%, along with a smaller carbon footprint. “Meanwhile, we are decommissioning our Butterworth smelter in stages, starting in 2024,” he added.

At Thursday’s close, shares of MSC dropped two sen, or 1% lower, to RM2.07, valuing the company at RM869.4 million after some 148,000 shares changed hands.