2024: Press Metal posts a 44% hike in full-year net profit supported by strong aluminium prices

Press Metal Aluminium Holdings Bhd, a Malaysia-based largest aluminium smelter in Southeast Asia, has announced its fourth-quarter and full-year results of 2024, reporting stupendous financial gains supported by increased aluminium prices on LME and strong global demand.

Figures and numbers revealed by Press Metal indicate a 38.55 per cent jump in net profit, reaching RM445.27 million at the end of the December quarter from RM321.39 million a year ago. For the entire year, the figure hit RM1.76 billion compared to RM1.22 billion in 2023.

The company's profit before tax in Q4 was $500.4 million, reflecting an increase of 25 per cent from $400.2 million in Q3 2023. Representing continued hikes, the full-year's profit before tax reached $2.3 billion versus $1.65 billion.

Press Metal managed to make these impressive Q4 profits despite a flat revenue of RM3.56 billion compared to RM3.53 billion a year ago. But annual revenue saw no glitch and climbed up 8 per cent Y-o-Y, amounting to RM14.91 billion from RM13.8 billion in 2023. All these financial gains were achieved in 2024 despite the challenges posed by soaring alumina prices, which is still a reason to worry for Press Metal's Chief Tan Sri Paul Koon Poh Keong as he believes limited bauxite sources due to global policy changes may lead to alumina price hike any time soon in the future.

Press Metal highlighted its fourth interim dividend at 1.75 sen per share for FY2024, payable on March 28, 2025, bringing total dividends for the entire year to RM576.77 million or 33 per cent of the group's net profit. Press Metal's basic earnings per share in 2024 were RM21.38 – 44.95 per cent higher than RM14.75 in 2023.

In the annual report, Mr Keong commented on Donald Trump's 25 per cent tariffs on aluminium imports, suggesting increased costs of end products resulting from higher aluminium prices and increased US Midwest premium as anticipated by the market. At the same time, he also noted that tariffs on imports would create a supply gap in the US domestic primary aluminium market, compelling downstream manufacturers to eventually turn back to external sources.

Keong added, "We see growing opportunities for low-carbon aluminium producers in Southeast Asia, driven largely by alternative sourcing and manufacturing relocations to the region."

Following the fiscal report announcement, Press Metal's shares closed down two sen or 0.4 per cent at RM5 on Wednesday, giving it a market capitalisation of RM41.2 billion. So far this year, the company's stocks have gained 3.52 per cent.

In 2025, Press Metal expects to continue delivering strong financial and operational performance, driven by the rising demand from China and reduced raw material costs due to increased alumina supply. According to a report from UOB Kay Hian (UOBKH) Research, the resurgence in aluminium demand from China due to the economic stimulus package is set to substantially boost aluminium consumption, including that from Press Metal, leading to estimated business growth. 

Press Metal will have a strong hold on alumina supply from its strategic joint venture with Indonesian parties signed in September 2024. The joint venture will set up an integrated refinery worth RM238bil with an initial capacity of 1 to 1.2 million tonnes.