Higher raw material costs dent LB Aluminium's Q2 earnings

PETALING JAYA: LB Aluminium Bhd’s net profit plunged 71.1% to RM1.67 million for the second quarter ended October 31, 2017 against RM5.78 million in the previous corresponding period, due to compressed margin as a result of higher raw material input costs.
Revenue for the quarter under review, however, rose 7.3% from RM118.28 million to RM126.94 million, thanks to higher average selling prices.
For the first half of the year, LB Aluminium saw its net profit fall 51.6% from RM10.9 million to RM5.27 million, while revenue grew 10.3% from RM227.97 million to RM251.36 million.
Looking ahead, the company said it has taken cognisance of the heightened supply-demand imbalances in the property market and it is strategising to mitigate the the potential adversity by focusing on the export market as well as possibility of product diversification.
“Rising operating costs, particularly raw material costs, continue to be of concern to the group and hence operational efficiency remains a priority for the group.”
Barring unforeseen circumstances, LB Aluminium is optimistic that it will remain profitable for the remaining of the financial year.”
Its shares declined 1.5 sen or 2.2% to close at 65.5 sen on some 228,500 shared done.