KUALA LUMPUR: Muda Holdings Bhd recorded a net profit of RM1.59mil in the third quarter ended Sept 30, 2021, which was a sharp drop from RM24.98mil posted in the previous corresponding quarter due to declining margin from higher production cost and lower output.

       In a bourse filing, the group said gross margin declined to 16.1% in the current quarter from 20.6% in the previous corresponding quarter amid a deficit on the revaluation of properties, higher operating expenses and reduction of wage subsidies.

       Earnings per share slid to 0.52 sen compared to 8.19 sen in the year-ago quarter.

       The group reported revenue for the quarter came to RM366.21mil, a 3.5% improvement over the same quarter last year.

       Moving forward, the group said market sentiment and selling prices of its products are likely to post some challenges in the final quarter of 2021.

       It added there will also be heightened competition from local and overseas paper mills and operating costs.

       Despite this, the board expects a profitable year for 2021.

       "The group will be able to catch up with production in the fourth quarter in line with higher vaccination rates among its employees and greater worker availability as more employees return from mandatory quarantine leave.

       "Going forward, the prudent management of rising operating and production cost will be the primary focus of the Board to sustain the group’s performance," it said.