MSM Malaysia Holdings Berhad posted a loss of RM16 million for the last quarter in 2021, this is a huge difference compared to the same quarter in 2020 when the group registered an RM56.6 million profit.
The group attributed the loss after tax to lower gross margin due to higher raw sugar, freight, and gas costs incurred in this quarter compared to the same quarter last year.
As for its full-year performance, MSM delivered a Profit Before Tax (PBT) of RM81 million for the 12 months ended 31 December 2021 (FY2021), against PBT of RM36 million in the corresponding period last year, although operating in a challenging environment with rising production cost, higher raw sugar, and freight cost. During FY2021, gain from disposal of MSM Perlis Sdn Bhd amounting to RM92 million has contributed to the Group recording a total consolidated PBT of RM170 million.
The Group also recorded higher revenue of RM2.26 billion for the full year compared to RM2.18 billion last financial year. The improved revenue for the quarter under review, RM642 million for 4Q 2021 compared to RM630 million for 4Q 2020 is mainly contributed by higher premium but hampered by lower volume due to reduced demand as consumption has not recovered to pre-COVID level.
MSM claims the flash floods in December affected its refined sugar warehouse located at Kota Kemuning and has initiated insurance claims in respect of the affected inventories. A full assessment of damages is currently in progress.
Chief Executive Officer, Syed Feizal Syed Mohammad said, “MSM has made good progress on its turnaround plans in 2021 amidst the rising trend of main production cost elements. On the domestic front, the positive development of the National Recovery Plan has provided strong impetus for greater economic recovery and socio-economic activities leading to more product consumption including sugar.”
Operationally, the production cost for the Group increased as compared to the previous year driven by 18% increase in raw sugar, 69% increase in freight cost, and lower utilisation factor (UF) due to temporary shutdown in MSM Johor for boiler rectification works and MSM Prai for sanitisation work.
Ad for outlook, on the export market, barring unforeseen circumstances, FY 2022 poses good opportunities within the Asia Pacific region that has a strong and growing demand. Besides strengthening market position in Vietnam, China, Singapore, and South Korea, MSM has a large anchor contract with Coca-Cola which it recently was awarded.
