KUALA LUMPUR (Dec 5): LB Aluminium Bhd saw its net profit fell 64.59% to RM4.37 million for the second quarter ended Oct 31, 2023 (2QFY2024), from RM12.35 million a year before, due to lower contribution from the aluminium segment.

Earnings per share dropped to 1.01 sen for 2QFY2024, from 2.84 sen previously.

Quarterly revenue, however, increased by 7.56% to RM221.67 million, from RM206.09 million previously.

Its aluminium segment’s profit before tax declined by 76.6% to RM4.12 million, from RM17.59 million previously, due to a decrease in both revenue and margins. The segment’s revenue came in at RM152.01 million, 19.3% lower compared to RM188.34 million a year before, due to lower sales volume and average selling prices.

Nonetheless, it was cushioned by better performance from its property segment, which reported a profit before tax of RM5.26 million, reversing a loss before tax of RM2.56 million previously, due to higher contribution from the SASaR (Satu Anggota Satu Rumah) residential project for the Armed Forces and PSV 1 Residences project, as a result of increases in both sales and work progress. The segment’s revenue increased to RM69.66 million, from RM17.75 million previously.

For the six months of FY2024 (1HFY2024), its net profit also dropped 65.01% to RM8.7 million, from RM24.86 million in 1HFY2023, while revenue inched down 1.3% to RM427.53 million, from RM433.15 million.

On prospects, it said the stabilisation of global aluminium prices augurs well for the group as its primary raw material is aluminium billet.

“However, the weakening of the Malaysian ringgit vis-à-vis the US dollar has increased the costs of our imported billets. We will continue to closely monitor our operational costs and selling prices to maintain our margins,” it noted.

For the property segment, it said cumulative sales for SASaR as of Oct 31, 2023 was 90.8% while cumulative sales for PSV 1 Residences stood at 62.8%. Cumulative construction progress for SASar was at 35.7%, with PSV 1 Residences at 21.3%.

“The projects will continue contributing positively to the group as and when we achieve higher sales and work progress,” it added.

The board is cautiously optimistic that the group will be profitable for the forthcoming quarter.

LB Aluminium’s share price closed up half a sen or 1.09% to 46.5 sen, bringing the stock a market capitalisation of RM202 million.