Latest Quarterly Summary: Future is going to be better.
From its latest quarterly report (2014 Q4), MALAYSIA STEEL WORKS (KL) BHD [S] (Masteel, 5098)appears to be very optimistic about the future as follows:
The Company is expected to increase its bar sales volume by 10% for the first half of the year and upon the commissioning of its new rolling mill during the second quarter, for the second half the year, it is anticipated to sell an additional 100,000 mt of high tensile steel bars.
The margin is expected to improve due to the following factors:
1) the continued decline in scrap prices.
2) the reduction in electricity tariff of 5.8% from March till June 2015.
3) higher levels of economies of scale due to higher volume of production .
4) the suspension of natural gas price revision by the Government.
5) due to the stabilizing international iron ore prices, the prices of Chinese steel imports are expected to bottom out.
The Company is expected to perform well in the following quarters based on prevailing business conditions.
The impending impositions of goods services tax (GST) on the Company’s products are not expected to have any material impact on the sales volume of the Company.
Shareholding Analysis: Something opposite
According to 2013 Annual Report, Dato’ Sri Tai Hean Leng, Managing Director and CEO of Malaysia Steel Works (KL) Bhd had around 4million Masteel shares.
However, the Managing Director disposed 4.1 Million shares on 30 Dec 2014 as that stated in Bursa Malaysia at a price of RM0.80 only. In other words, the Managing Director already disposed all the shares that directly held by him and obtained around RM3.28million cash.
Question: Why the Managing Director who was so confident with Masteel’s future sold 4million shares?