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According to Lion Industries Corp Bhd, the company may close two long steel product plants it owns through its wholly-owned subsidiary Amsteel, located in Banting and Bukit Raja, Klang. 20QG085 GO Electrical steel, While details are still unclear, the closures could potentially take place as early as the end of this year.
The factories in Banting and Klang produce steel bars, specialty steel, and wire rods for the construction and manufacturing industries. 20QG085 GO Electrical steel, These are the core revenue sources for the Lion Group.
The company is also involved in real estate development and, through its 74%-owned listed company Lion Posim Bhd, distributes building materials, sanitary ware, faucets, tiles, hardware, and lubricants.
In the 2021 fiscal year, which was its only profitable year in the past five years, the company recorded revenue of RM2.13 billion and a net profit after tax of RM887.37 million. 20QG085 GO Electrical steel, However, an examination of Lion Group's financial statements suggests that Amsteel's profitability may have been due to a gain of RM440.5 million from the sale of a subsidiary and a gain of RM193.1 million from a guaranteed debt settlement arrangement.
As of the end of December 2024, Amsteel's total assets amounted to 1.2 billion Malaysian ringgit, and its total liabilities were 1.07 billion Malaysian ringgit, with current liabilities requiring repayment within 12 months totaling nearly 700 million Malaysian ringgit.
In the notes to its financial statements, Golden Lion Group stated: "The operating environment for the Malaysian steel industry is expected to remain challenging in the next quarter. 20QG085 GO Electrical steel, The industry continues to face issues of overcapacity, intense competition, and rising operating costs, all of which are squeezing profit margins and impacting overall performance."
"To address these challenges, the Group will take proactive measures to respond to the current market conditions. 20QG085 GO Electrical steel, Key areas of focus will include improving operational efficiency and implementing strict cost control measures."
Golden Lion Group and Amsteel have been selling assets and are currently in the process of selling two freehold land parcels, measuring 19.78 acres and 7 acres respectively, to Unichamp Mineral Sdn Bhd for cash prices of RM67.96 million and RM24.07 million through a related-party transaction.
At the end of 2023, four major Malaysian long steel companies—Ann Joo Resources Bhd, Malaysia Steel Works Bhd, Southern Steel Bhd, and Lion Group—sought government assistance, claiming that the Chinese-owned steel company Malaysia Steel Works (M) Sdn Bhd had violated the terms of its manufacturing license and was dumping certain specifications of steel products onto the local market.
However, Ma Steel's presence in Malaysia is the result of an intergovernmental cooperation initiative. Its products include billets, rebar, high-speed wire rods, and large H-beams and H-section steel beams. One requirement in its manufacturing license is that it must export at least 50% of its steel supply chain output, unless the product is one that is not currently produced in Malaysia, such as H-section steel beams.
