Midas Holding's Q3 net profit skyrockets 62.5% to $4.7m

Contributions from Nanjing Puzhen Rail Transport propelled earnings.

Rail transport supplier Midas Holdings has seen a 62.5% upsurge in earnings for the quarter ending in September at $4.7m (RMB 22.6m)

According to Midas CEO Patrick Chew, this growth was supported mainly by the increased contribution from the group's associated company, CRRC Nanjing Puzhen Rail Transport Co, which recorded a share of RMB 12.4m in 3Q16 compared to RMB 2m last year.

"We are also seeing initial results from our diversification strategy as maiden contributions from the newly acquired Aluminium Alloy Stretched Plates division kicked in during the review quarter," he said.

He added, "This is an encouraging development testament to the strategic focus of our growth strategies, and we will endeavour to maintain the Group’s edge as a leading supplier of aluminium alloy product amidst a competitive market.”

This improvement in bottomline came as total revenue rose 2.1% to RMB 420.8m in 3Q16, mainly due to revenue of RMB 123.0m from the new Aluminium Alloy Stretched Plates Division following its acquisition by Midas.

However, the group noted that overall gross profit margin fell slightly to 24.0%, compared to 25.9% in 3Q15. This was attributable to lower gross profit margin from the Aluminium Alloy Extruded Products Division, which decreased from 26.1% in 3Q15 to 24.8% in 3Q16, due to a different product mix in the respective periods.