KUALA LUMPUR (Nov 22): Batu Kawan Bhd’s net profit for the fourth financial quarter ended Sept 30, 2017 (4QFY17) fell 26% year-on-year to RM145 million from RM194.73 million, after incurring a tax expense of RM123.23 million compared to a tax credit of RM164.63 million a year ago.

In its filing with Bursa Malaysia, Batu Kawan said its profit before tax rose 64% to RM422.6 million during the quarter from RM257.93 million in 4QFY16, as there was an increase in profitability across all its business segments i.e. plantations, manufacturing and property development.

Quarterly revenue came in 14% higher y-o-y at RM5.3 billion versus RM4.66 billion previously on higher crude palm oil selling price and increased fresh fruit bunches (FFB) production in its plantation division, and higher sales volume and higher selling prices at its oleochemical division.

The group declared a dividend of 45 sen per share, to be paid on March 15 next year, pushing its full year payout to 60 sen compared with 55 sen in FY16.

For the full year ended Sept 30, 2017 (FY17) Batu Kawan reported a 29% y-o-y decline in net profit to RM586.65 million from RM825.17 million, though revenue rose 27% to RM21.55 billion from RM16.97 billion.

On prospects, Batu Kawan said its plantation profit for FY18 is expected to be satisfactory due to projected strong recovery in FFB production, coupled with an environment of ample supply of oilseeds that may affect palm oil prices.

“Profitability of the group’s oleochemical business should improve despite a competitive environment from industry’s excess capacities. For the chemicals division, profit from the chlor-alkali business is sustainable albeit lower than financial year 2017 in anticipation of lower prices and projected higher energy cost. Overall, the group expects better profit for financial year 2018,” the group said.

Batu Kawan shares closed unchanged at RM19.80, for a market capitalisation of RM7.96 billion. — theedgemarkets.com

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