PETALING JAYA: Guan Chong Bhd, the world’s fourth largest cocoa grinder recorded a 30.6% jump in net profit to RM123.6 million for the first quarter ended March 31, 2026 (Q1’26), from RM94.6 million in the previous year, attributed to improved grinding margins and lower finance costs.
The improved profit was achieved was despite a 39.1% decline in revenue to RM2.62 billion, from RM4.31 billion previously. The drop in revenue was due to a decrease in average selling prices of cocoa products – cocoa ingredients and industrial chocolate – in tandem with easing cocoa bean prices.
The deflated cocoa bean prices have in turn alleviated GCB from the working capital pressures and borrowing requirements faced by the group when bean prices peaked at over US$12,000 a tonne back in December 2024. As a consequence, the group’s total borrowings declined by 35.2% to RM2.94 billion at end of Q1’26, from RM4.54 billion previously on March 31, 2025.
Managing director and CEO Brandon Tay Hoe Lian said: “With our finance costs now under control, we can start to capture earnings better for the current financial year 2026. We will gradually ramp up our grinding operations in Malaysia, Indonesia, and Ivory Coast to keep up with the expected increase in market demands.”
He added that they are seeing demand for cocoa ingredients making a comeback.
“Now that cocoa bean prices have eased, confectionery players are capitalising on the low prices and planning to put more cocoa content back into their products. We expect to benefit from the demand recovery wave,” Tay said.
Nonetheless, he added, they will continue to monitor market developments and implement proactive measures to secure a consistent and reliable supply of cocoa beans, ensuring operational continuity and resilience.
GCB declared a second interim dividend of 1.5 sen per share in respect of the financial year ending Dec 31, 2026, representing a payout of RM41.1 million. The dividend ex-date is June 19, with payment on July 10. In addition to the first interim dividend of 1.5 sen per share paid on April 10, the total payout amounts to RM82.2 million.
