TH Plantations 1Q net profit up 75%

by **Cals** Fri 23 May 2014, 00:12

Business & Markets 2014

Written by Adrian Wong of theedgemalaysia.com

Thursday, 22 May 2014 10:07

KUALA LUMPUR: TH Plantations Bhd’s net profit rose 75% to RM5.62 million for the first quarter ended March 31, 2014 (1QFY14) from RM3.21 million a year ago, due to higher selling prices of its palm products and fresh fruit bunch (FFB) production.

Revenue for 1QFY14 grew 39% to RM124.25 million from RM89.45 million, driven by an 8% growth in FFB production and 34% growth in crude palm oil (CPO) production.

TH Plantations said its CPO average selling price also improved by 23% to RM2,507 per tonne in 1QFY14 in line with strengthening commodity prices.

Earnings per share increased to 0.64 sen from 0.44 sen in 1QFY13.

“We are encouraged by our promising first quarter results, despite the first quarter being seasonally weaker,” said TH Plantations chief executive officer and executive director Datuk Zainal Anwar Zainal Aminuddin in a filing with Bursa Malaysia yesterday.

He noted that the unpredictable weather in 1QFY14 only had a small impact on the group’s production and it is currently on track to meet its targeted FFB production for the year.

“Stronger CPO prices have boosted our revenues and we are cautiously optimistic that we will be able to further improve our performance in the coming quarters,” he said, adding that the group’s land acquisitions in the past years are steadily coming to fruition.

As at March 31, 2014, TH Plantations’ plantation landbank totalled 109,000ha. Of this total, some 98,000ha of land are located in Malaysia, of which about 60,000ha have been planted with oil palm. The remaining 11,000ha of greenfield land are situated in Kalimantan, Indonesia.

To diversify its income stream in coming years, 4,000ha of its land have been planted with rubber, said Zainal.

TH Plantations also owns and operates seven palm oil mills in Johor, Pahang, Negeri Sembilan, Sabah and Sarawak, with a total FFB processing capacity of 1.35 million tonnes per year.

Shares in TH Plantations closed up one sen or 0.46% at RM2.17 yesterday, giving it a market capitalisation of RM1.91 billion.

This article first appeared in The Edge Financial Daily, on May 22, 2014.