Sime Darby Q4 profit rises 19%

by **Cals** Mon 02 Sep 2013, 05:41

Published: Saturday August 31, 2013 MYT 12:00:00 AM
Updated: Saturday August 31, 2013 MYT 7:07:05 AM
Sime Darby Q4 profit rises 19%
BY NG BEI SHAN
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Tong (right) Hamzah at the results briefing yesterday.
KUALA LUMPUR: Despite being hurt by lower crude palm oil (CPO) prices, Sime Darby Bhd’s net profit for the fourth quarter ended June 30 rose 19% due to the disposal of its 50% stake in its healthcare assets.
The conglomerate posted RM1.31bil in earnings, which included a RM340mil one-off gain from the divestment of its healthcare business to Australia-based Ramsay Health Care Ltd and higher property sales.
Going forward, its chief group financial officer Tong Poh Keow expected the plantation division’s weaker showing to be offset by the stronger performance at other divisions like property, industrial and motor.
In the fourth quarter, the plantation division’s profit before interest and tax declined 51% year-on-year to RM399.4mil compared with RM807.2mil due to the lower CPO price realised of RM2,250 per tonne against RM3,010 in the previous corresponding period
She expects slightly better CPO prices towards the end of 2013 on improved demand.
Although full-year earnings were 11% lower, the company declared a final dividend of 27 sen per share, bringing full-year dividend to 34 sen, which translates to 55% payout of its net profit.
Tong said the board had approved a dividend reinvestment plan (DRP) that allowed shareholders to subscribe to DRP shares at a 5% discount to the five-day volume weighted average price before price fixing date, after adjusting for the final dividend.
She also said that rubber would be coming to a “bigger play” in the group, adding that the conglomerate was also studying the possibility of venturing into other crops such as sugar.
Tong told reporters at the financial results briefing yesterday that Sime Darby was looking into planting rubber in its Liberia concession on top of the existing 8,000ha of rubber plantation and the acquisition of 10,000ha in Indonesia.
On land-banking, she said: “We have been studying the feasibility of quite a number of land-banks in Africa and even in South-East Asia and due diligence had been performed on these properties.”
Asked about the flotation of its property arm, Tong said that listing was one of the options to maximise its value and that the conglomerate was looking at all the divisions and it was studying various proposals.
Group strategy and business development executive vice-president Alan Hamzah said there could be “more news at the annual general meeting”.