KUALA LUMPUR: Kuala Lumpur Kepong Bhd’s (KLK) net profit for the third quarter ended June 30, 2022 decreased 28.79% to RM558.27 million compared with RM783.94 million for the corresponding quarter last year mainly due to the absence of non-operational gains which were included in previous year’s profit under corporate income.
This includes fair value surplus amounted to RM324.3 million on deemed disposal of an associate, Aura Muhibah Sdn Bhd, and negative goodwill of RM2.9 million arising from acquisition of Aura Muhibah.
Excluding the non-operational gains, the group’s pre-tax profit would be 20.4% higher at RM753.7 million compared with RM626.1 million it recorded in Q3’21.
Its revenue increased 34.57% to RM6.96 billion from RM5.17 billion.
For its nine-month period, its net profit increased 4.44% to RM1.70 billion from RM1.63 billion. Revenue for the same period rose to 44.28% to RM20.17 billion from RM13.98 billion.
On its current year prospects, the group expects to deliver a favourable set of results for FY22.
“Crude palm oil (CPO) prices have recently fallen from historical highs, triggered by global recessionary fears and backlog of CPO stockpiles in Indonesia. However, supply of vegetable oils globally is still tight and prices are expected to be supported at current levels. Apart from the softening commodity prices, the operating environment for the plantation sector in the next quarter will be challenging with supply chain disruptions and inflationary pressures on fertiliser, agrochemicals and fuel prices. The group has taken steps to mitigate these risks by continuing its efforts to aggressively boost productivity and enhance its mechanisation programmes. Plantation profit is expected to improve in FY22, driven by higher CPO and palm kernel prices as compared to the previous year.
“In the manufacturing segment, raw material price volatility, high energy costs and persistent logistic issues continue to pose challenges for the remainder of the current financial year. Nevertheless, the group expects the segment’s performance to be satisfactory, supported by its ability to consistently deliver high-quality and sustainably produced ingredients in a tight supply environment,” it said.