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Lion Industries posts fourth straight quarterly loss of RM110.6m

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KUALA LUMPUR (Nov 29): Lion Industries Bhd reported a net loss of RM110.62 million for the first quarter ended Sept 30, 2019 (1QFY20) versus a net profit of RM19 million a year ago, including a lower margin of its steel division, and higher loss from associated companies and joint ventures.

This marks its fourth consecutive quarterly loss.

As a result, it registered a loss per share of 16.25 sen from 2.79 sen for 1QFY19, Lion Industries said in a filing with Bursa Malaysia.

Revenue fell 29% to RM656.4 million from RM926.31 million last year due to lower revenue registered by its steel division.

Its steel division reported a loss from operations of RM76.6 million against a profit of RM33.3 million last year, due to narrower profit margin. Revenue for the segment declined 29% to RM580.11 million from RM818.83 million.

The building materials division posted a higher profit of RM1 million from RM76,000 last year on higher revenue of RM114.74 million, a 56% growth from RM73.7 million previously.

Its profit from other segments, which consists of sales of lubricants, automotive and petroleum products and the provision of management services and property development projects, reported a loss of RM1.13 million against a profit of RM1.96 million a year ago. Revenue for the segment fell 18% to RM30.98 million from RM37.77 million a year ago.

On prospects, the group said the operating environment of the steel industry is anticipated to face increasing challenges in view of the heightening global economic and geopolitical uncertainties.

It added that the prices of steel products and raw materials remain volatile while demand from the construction and property sectors remains low.

“The group will stay vigilant and responsive to market changes and improve its operating performance for the next quarter,” it said.

Lion Industries' shares closed one sen or 3.13% higher at 33 sen, bringing it a market capitalisation of RM224.67 million. It saw some 1.2 million shares done.