Southern Alliance Mining (SAM) has reported a bigger loss of RM27.3 million ($8.36 million) for the full year ended July 31.
However, revenue for the full year grew 20% y-o-y to RM199.5 million. The group says that this growth was driven by a new revenue stream from bauxite sales during the financial year.
Gross profit for the FY2025 declined 66% y-o-y to RM3.1 million due to softer iron ore prices in the steel industry, which led to a substantial y-o-y decline in average realised selling price (ARSP) for iron ore products.
The year saw challenging pricing environments, with general decline in the ARSP across iron ore products in FY2025.
Despite this, the group says that iron ore concentrate sales volume rose by 22% y-o-y, crushed iron ore sales volume surged by 350% y-o-y, and iron ore tailings sales volume grew by 5% y-o-y. The increase in volume results from previous investments in underground mining at the Chaah Mine concession.
In the full year, the group recognised a total sum of RM26.1 million in non-cash impairment losses.
These impairment losses arose primarily from a RM18.9 million non-cash impairment loss on the group’s mining assets due to the slowdown in demand for iron ore products from the steel industry and lower price projections; a RM5.0 million non-cash impairment loss relating to the investments in joint ventures following the non-renewal of exploration licences in Sabah, Malaysia, which were acquired as part of earlier portfolio expansion efforts; and a RM2.2 million non-cash impairment loss on the investment in a joint venture with an iron ore mining site in the state of Pahang, Malaysia.
For illustrative purposes, SAM’s loss before tax would have been RM5.4 million instead of a loss before tax of RM31.5 million if these impairment losses were excluded.
SAM reported a positive operating cash flow of RM4.4 million in FY2025, and cash and bank balances as at end June stood at RM113.8 million.
Shares in SAM closed 4 cents lower or 8.889% down at 41 cents on Sept 26.
