KUALA LUMPUR AND SINGAPORE: Malaysia Smelting Corporation Berhad (MSC), a leading tin miner and metal producer, has announced its financial results for the first quarter ended 31 March 2024 (1QFY24).
During this quarter, MSC’s net profit attributable to owners surged by 93.6% quarter-on-quarter (QoQ) to RM18.2 million, up from RM9.4 million in the previous quarter (4QFY23). This significant increase was primarily driven by a rise in average tin prices (RM124,900/tonne in 1QFY24 compared to RM116,000/tonne in 4QFY23).
The Group’s tin smelting division recorded a net profit of RM9.9 million in 1QFY24, a turnaround from a net loss of RM2.2 million in 4QFY23. This recovery was attributed to favorable tin price movements and foreign exchange gains during the quarter.
Similarly, MSC’s tin mining operations saw a net profit increase of 19.3% QoQ to RM14.2 million in 1QFY24, up from RM11.9 million in 4QFY23, benefiting from the stronger tin prices.
Meanwhile, MSC’s revenue for 1QFY24 stood at RM362.5 million, down from RM404.6 million in 4QFY23. Despite the higher tin prices, the Group’s performance was impacted by a shortage of tin ore, leading to lower refined tin sales and smelting revenue. However, the Group believes the situation in tin ore-producing countries like Myanmar and Indonesia, which has affected MSC’s toll smelting business, will improve.
MSC Group Chief Executive Officer, Dato’ Patrick Yong commented, “Our 1QFY24 performance demonstrated resilience amidst a challenging global landscape characterized by ongoing inflation, tightening monetary policies, and supply chain disruptions. We remain committed to securing a reliable supply chain and executing our long-term growth plans.”
Yong added, “The relocation of our smelting operations from Butterworth to the newer Pulau Indah smelter is nearly complete, with the Butterworth smelter set to be decommissioned by 2025. On the mining side, we are working to enhance productivity by expanding mining activities and exploring new tin resources.”
“Looking ahead, our commitment to sustainable growth ensures a brighter future for MSC. We are confident in our ability to unlock new opportunities and solidify our position as a leader in the tin industry.”
As of 31 March 2024, total borrowings decreased by 17.4% to RM297.3 million, down from RM359.8 million as of 31 December 2023, due to repayment of borrowings. This resulted in an improved gearing ratio of 0.35x as of 31 March 2024.
Year-on-year (YoY), MSC’s revenue grew by 6.6% to RM362.5 million from RM340.1 million, driven by favorable tin price movements. Tin prices averaged 7.6% higher at RM124,900/tonne in 1QFY24 compared to RM116,100/tonne in 1QFY23.
The Group’s smelting division posted a net profit of RM9.9 million in 1QFY24, compared to RM24.6 million in 1QFY23. The slower performance was mainly due to the absence of sales of refined tin derived from processed tin intermediates and by-products, as well as lower smelting revenue. The tin mining segment reported a net profit of RM14.2 million in 1QFY24, down from RM17.5 million in 1QFY23, due to lower tin production quantities.
