Update Strong cement demand lifts Tasek Corp 2Q profit by 42.5%

by **Cals** Wed 06 Aug 2014, 01:11

Update Strong cement demand lifts Tasek Corp 2Q profit by 42.5%

Business & Markets 2014

Written by Charlotte Chong of theedgemalaysia.com

Tuesday, 05 August 2014 19:10

KUALA LUMPUR (Aug 05): Tasek Corporation Bhd announces a net profit of RM31.1 million in its second quarter ended June 30 this year, an increase of 42.5% from last year’s RM21.82 million.

Tasek Corp has declared a dividend of 40 sen to be paid on Sept 09 this year — eight sen higher compared with 32 sen declared in the corresponding quarter last year.

The cement maker's revenue came in 20.78% higher at RM171.5 million, compared with RM142 million a year earlier. Earnings per share expanded to 25.6 sen, from 17.96 in the previous corresponding quarter a year ago.

In an announcement with Bursa Malaysia today, the Tasek Corp said that the higher revenue was mainly due to higher demand for cement locally.

“However, the profit after tax for the current quarter was partially affected by lower share of profit from the group's associated company and lower interest income during the current quarter.”

Although its cement segment has achieved higher operating profit on the back of higher sales revenue, its concrete segment has recorded an operating loss of RM7,000 in the current quarter, compared with profit of RM761,000 in a year ago.

It explained in the same note that the loss was mainly due to lower sales revenue arising from the reduction in concrete sales volume, which was partly offset by higher average selling price.

“Sales volume was adversely affected by the closure of the Subang site plant [during] end of August last year, while the segment's profitability was also affected by the rising costs of production relating to higher costs of aggregate and sand materials during the current quarter, compared with the corresponding quarter of previous year.”

As for its six months ended June 30, its net profit has climbed 28.7% year-on-year to RM56.02 million, from RM43.53 million in 2013. Revenue grew 20.25% to RM334.4 million, from RM278.09 million.

It noted that the group is expected to continue to maintain its positive performance for the third quarter of 2014.

“The ongoing government's projects under its Economic Transformation Programme such as the MRT projects and LRT line extension, are expected to continue to lead the construction sector's growth in the remaining months of 2014,” it added.