PETALING JAYA: Kuala Lumpur Kepong Bhd’s (KLK) net profit for the first quarter ended Dec 31, 2018 rose 6.61% to RM250.92 million from RM235.36 million a year ago driven by property development and investment holding segments.
In a filing with Bursa Malaysia, KLK said its property development segment achieved a much higher profit of RM11.1 million during the quarter compared with RM1.7 million a year ago supported by the increase in revenue to RM39.8 million compared with RM17.9 million a year ago.
Under the investment holding/others segment, the farming business recorded a higher profit of RM56.5 million compared with RM31.9 million a year ago due to higher crop production as a result of better yields and larger cropped area.
However, the plantation segment’s profit fell sharply by 58% to RM127.5 million from RM303.6 million a year ago despite the 7.9% improvement in fresh fruit bunches (FFB) production to 1,105,465 MT, due to the drop in crude palm oil (CPO) and palm kernel (PK) selling prices realised.
The manufacturing segment also recorded lower profit of RM98 million, reflecting a 28.8% drop from RM137.7 million a year ago while revenue fell 12.4% to RM2.20 billion from RM2.52 billion a year ago as a result of lower selling prices.
“Decline in profits from China and Europe operations had more than offset the improvement in profits from Malaysia operations,” KLK said.
The oleochemical division’s profit was lower at RM94.5 million compared with RM137.1 million a year ago but profit from the other manufacturing units had increased to RM3.5 million compared with RM641,000 a year ago.
KLK said the group’s profit had accounted for foreign currency exchange gain of RM38 million which arose from the translation of inter-company loans denominated in foreign currencies and a surplus of RM22.5 million arising from government acquisition of plantation land.
Revenue for the quarter fell 21.06% to RM4.09 billion from RM5.18 billion a year ago.
Moving forward, the group expects a reasonably satisfactory profit for the financial year ending Sept 30, 2019 (FY19).
“Prevailing CPO prices had since recovered from the low levels in the preceding quarter. Should such recovery be sustained, we are optimistic that the prospects for plantation profit for FY19 will be satisfactory,” it said.
It expects the oleochemical division to sustain its performance through increase in capacity utilisation and improvement in margins.
KLK’s share price fell 0.24% to close at RM24.74 today with 317,700 shares traded.
