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Home / 2008 Annual Report: Chairman’s Statement

On behalf of the Board of Directors (Board), it is my pleasure to present the Annual Report and Audited Financial Statements of Malaysia Steel Works (KL) Bhd (“Masteel”) for the financial year ended 31st December 2008.


Masteel responded well to the favorable business environment and continued to excel in both the local and international market. Masteel achievement is reflected in the commendable financial results over the previous years. China’s imposition of export duties on billets and bars as well as removal of rebates for steel products had helped to increase the prices of steel billets and bars. Meanwhile, the cost of raw materials and other consumables had also increased in tandem with the higher finished steel products.

The gradual implementation of the 9th Malaysia Plan had also spurred the demand for steel for most part of 2008. However, in 4th quarter, the effects of the global financial crisis have started to impact the demand and prices of steel. Overall the performance of Masteel was satisfactory and a new level of profitability was achieved for this year.


During the year under review, Masteel had achieved a starling revenue of RM 881.2 million and net profit before tax of RM 85.7 million. These results also showed a 61% and 86% increase respectively over its 2007 performance. The robust demand and higher selling price for steel bars and billets as well as the various cost reduction programmes that was successfully carried out and plant capacity improvement also helped in contributing to the better bottom line.

The government’s lifting of the ceiling control price for billets and bars during first half of 2008 had also aided the rapid raised of turnover for the company and ended many decades of government intervention in domestic steel prices.


The Board of Directors is pleased to announce a first and final single tier dividend of 2.5 sen per share (2007 : 3 sen per share) net dividend payable. If approved at the Annual General Meeting, will amount to RM 4.87 million (2007 : RM 4.38 million).


The financial performance of 2009 will largely be dependent on the effectiveness of the various stimulus packages and the restructuring of the financial and banking sectors in America and European Community countries. With the new government headed by Yang Amat Berhormat Dato’ Sri Najib Tun Razak, the effects of the RM 60.0 billion stimulus plan is expected to be felt by the 4th quarter of 2009. However, the demand and prices of steel globally are expected to be substantially reduced for 2009. The performance of the company is expected to gradually improved form the latter part of the year.


On behalf of the Board, I would like to extend our deepest appreciation to our valued clients, shareholders, business associates, financiers and relevant authorities for their continuous supports and confidence shown to us. I would like to take this opportunity to extend my appreciation to our management and staff for their continued dedications and contribution toward the future growth of the Group.



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