KLK 4Q profit falls, declares final dividend

KUALA LUMUR: Kuala Lumpur Kepong Bhd’s (KLK) net profit fell 39% year-on-year to RM258 million for the fourth quarter ended Sept 30 of 2013 financial year (4QFY13), from RM422.3 million in the previous corresponding period.

Revenue stayed largely unchanged at RM2.41 billion during the quarter, indicating the weak crude palm oil price had eroded its earnings.

In its filing with Bursa Malaysia yesterday, KLK declared a final dividend of 35 sen per share.

For the full FY13, the major plantation group recorded a total net profit of RM917.7 million, down from RM1.2 billion in FY12.

Its annual revenue fell to RM9.1 billion, from RM10.6 billion in FY12.

The company said profit from plantations fell 22% to RM213.2 million in 4QFY13 due to weaker palm oil and rubber prices.

It said the weaker FY13 results were mainly due to a 33.3% fall in profit from plantations on lower prices of rubber and palm oil and related products.

Changes in fair value on outstanding derivative contracts had resulted in an unrealised loss of RM6 million.

But the manufacturing sector’s profit surged 125% to RM105.9 million, with the oleochemical division recording a sharp
88.3% rise in profit to RM95.3 million.

The property sector’s profit rose significantly to RM24.4 million with increased profit recognition from Bandar Seri Coalfields in Sungai Buloh, Selangor.

KLK also noted that 4QFY12 had included a surplus of RM135.7 million from the disposal of the retailing business.

On its outlook, KLK said it anticipates better plantation profit for FY14.

But the oleochemical market is expected to be oversupplied with an increase in capacities worldwide and it will be a challenge to manage increased capacities, it said.



This article first appeared in The Edge Financial Daily, on November 21, 2013.