Southern Cable posts 81pct lower profit in Q3, has RM550mil orders

NST Sun, Nov 28, 2021 09:05am - 2 years View Original


KUALA LUMPUR: Southern Cable Group Bhd's net profit plunged 81.2 per cent to RM1.38 million in the third quarter (Q3) ended September 30, 2021 from RM7.34 million net profit recorded in the same quarter a year ago.

In a statement, the cable and wire manufacturer said this was due to the lower revenue, as well as the impact of higher plastic-based and metal-based raw material prices.

Southern Cable's revenue for the quarter was 16.1 per cent lower at RM127.2 million from RM151.56 million previously, on weaker sales of power cables and wires and the impact of various phases of the Movement Control Orders (MCOs).

Southern Cable said it now has orders in hand of RM549.7 million, estimated to be delivered over the next two years, as it meets the surging demand for power cables and wires locally.

The orders in hand comprise RM225.7 million unbilled purchase orders from new customers, as well as RM324.0 million order book from existing customers.

This includes recently-won contracts such as the RM30.4 million contract supply rectifier systems to Telekom Malaysia Bhd and an RM18.5 million contract to supply underground cables and conductors to Tenaga Nasional Bhd.

The company said it had been receiving higher orders and supply contracts from new and existing customers, in line with the resumption of economic and business activities as majority of the nation's states had advanced to phase 4 of the National Recovery Plan.

Southern Cable managing director Tung Eng Hai said the company was seeing an encouraging uptrend in customer enquiries in recent months, indicating the return of expansionary sentiment across all sectors, including power distribution and renewable energy, telecommunications, construction and infrastructure, as well as manufacturing sectors.

"Our operations are now at 100 per cent workforce capacity since October 2021, with more than 80 per cent of our employees fully vaccinated. With our operations back to peak condition compared to half-capacity in Q3 2021, we aim to ensure the smooth fulfilment of orders and deliveries to our clients.

"We will remain vigilant and prioritise the health and safety of our employees. Not only that, we intend to continue our product development and expansion plans to sustain our long-term growth prospects," he added.

For the nine-month period, Southern Cable's net profit dropped 51.1 per cent to RM8.06 million from RM16.48 million, while revenue increased 16.1 per cent to RM455.92 million from RM392.65 million.

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