Kuala Lumpur - Chemical Company of Malaysia Berhad (CCM) recorded revenue of RM1.6 billion for its financial year ended December 31, 2009 - a 27.4 per cent decline from RM2.2 billion compared to the corresponding period last year amid poor market conditions exacerbated by an overall decline in prices and demand particularly in the first half of 2009.
The Group's profit before tax (PBT) for the period was RM15.6 million, 87.0 per cent lower from RM120.3 million compared to 2008.
The prolonged global economic downturn significantly affected the Group’s main revenue drivers, as Fertilizers and Chemicals businesses registered a 36.2 per cent and 28.8 per cent fall respectively in revenues. The Fertilizers Division’s PBT slipped 80.1 per cent while the Chemicals Division experienced a RM15.4 million loss before tax.
CCM’s Pharmaceuticals Division however recorded a 4.3 per cent rise in revenue to RM242.7 million from RM232.7 million for the period under review last year while PBT dipped 6.3 per cent to RM34.9 million from RM37.2 million. The increase in revenue was due to the Division’s success in securing a new Government tender.
The Pharmaceuticals Division aims to accelerate its performance and boost production capacity by ensuring maximum capacity utilization and optimal efficiency of its Bangi plant.
The Fertilizers Division’s revenue fell from RM1.4 billion in 2008 to RM897.3 million last year while PBT decreased to RM16.6 million in 2009 compared to RM83.5 million achieved in the same period in the previous year. The drop in revenue and PBT was attributed to overall lower prices and softer customer demand. However, the outlook for the Fertilizers Division is expected to improve following a greater demand for fertilizers in 2010, driven by stronger crude palm oil prices.
The Division also recently established a strategic alliance with the Malaysian Agricultural Research and Development Institute (MARDI) to undertake research and development (R&D) activities to promote the commercialization of Nitro Humic Acid (NHA) and crop booster foliar fertilizers. NHA, a cost-effective compound formulation helps to enhance plant crop yield. The commissioning of its Medan plant is also set to reap the huge fertilizer market in Indonesia and improve sales of its compound fertilizers.
Meanwhile CCM’s Chemicals Division revenue fell 28.8 per cent to RM432.0 million from RM606.5 million in the corresponding period last year. The loss was due to contraction in overall sales volume, selling price and costs involved in the conversion of the Group’s Shah Alam fertilizers plant to a urea-based production process. An extraordinary charge, contributed to a PBT loss of RM15.4 million compared to a profit of RM14.7 million in the same period last year. Without the extraordinary charge, the Division’s PBT would have seen a profit of RM1.9 million. Provisions for doubtful debts and write-down of stock values in the early part of the year, arising from falling product prices also contributed to the loss in PBT.
The Chemicals Division however remains upbeat especially as the local rubber gloves sector is now poised for further growth. The acquisition of the Innovative Group of Companies enable the Division to enhance its specialty chemicals business to serve the rubber glove industry and plans are afoot to tap into other niche areas to strengthen its presence and equity in the chemicals industry.
Meanwhile, the fourth quarter ended December 31, 2009 continued to mirror the tougher business conditions leading to a 24.2 per cent decrease in CCM’s revenue to RM402.2 million from RM530.8 million compared to the same quarter last year. The Group experienced a RM8.5 million loss in PBT in the corresponding period compared to f RM1.7 million in the previous year. However, without extraordinary charge, the Group would have seen a profit of RM7.752 million for the quarter.
The CCM Board of Directors has recommended a dividend of 8.0 sen tax exempt dividend (2008: Final dividend of 1.8 sen per ordinary shares less tax at 25 per cent and 4.85 sen tax exempt dividend) in respect of the current financial year ending December 31, 2009.
CCM, Malaysia's largest generic pharmaceutical manufacturer, is listed on the main board of Bursa Malaysia and is a key player in the fertilizers, chemicals and pharmaceuticals industries.
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Issued with the compliments of Chemical Company of Malaysia Berhad Through Eric Pringle Associates Public Relations Sdn Bhd. For further information, please contact Ida Fazila Ismail at Tel no: 03-21617144 or email: ifazila@epapr.com.my |
