Press Metal reports a 6.2% drop in revenue caused by slower aluminium demand recovery

Press Metal Aluminium Holdings Bhd, the largest aluminium smelter in South East Asia, announced the second quarter results of 2023, reporting a 25 per cent year-on-year decline in net profit ended June 30. The company’s net profit for Q2 was recorded at RM305.79 million or 3.73 sen per share compared to RM409.17 million or 4.97 sen per share a year ago. 

Revenue for Q2 2023 slipped Y-o-Y by 6.2 per cent from RM4.0 billion to RM3.76 billion, attributing to the delay in global economic recovery causing weaker aluminium demand, analysed Press Metal Group CEO Tan Sri Paul Koon Poh Keong.

Keong said in a statement on Tuesday, August 29, “The current weakness in aluminium price can be attributed to softened demand driven by market uncertainties, rather than aluminium supply propelled by smelter restarts.”

For the entire H1 2023, Press Metal’s net profit shrank by 29 per cent to RM587.76 million from RM830.19 million during the corresponding period of the previous year. Revenue fell by 14 per cent to RM6.83 billion from RM7.93 billion.

Koon said global aluminium demand experienced a hit in many sectors, such as construction and industrial segments, caused by high interest rates and inflation. However, the aluminium usage is projected to grow in green industries, especially the transportation and energy sectors.

“We are well positioned to align our growth with the complementary prospects of electric vehicles and the advancement of solar installation. Despite the challenging environment, we continue to grow our in-house value-added products volume, demonstrating that we have continuously increased our market penetration,” Koon added.

On Tuesday, August 29, Press Metal shares closed one sen or 0.2 per cent higher at RM4.90, giving it a market capitalization of RM40.37 billion.