KUCHING: Ta Ann Holdings Bhd has posted higher group net profit of about RM43.3 million in first quarter to March 31, 2024 (1Q2024) against RM39.3 million a year ago on sharply higher fair value gain from biological assets.
Group revenue grew marginally to RM352.4 million from RM350.7 million in 1Q2023. The oil palm segment generated revenue of RM292.5 million (1Q2023: 283.6 million), timber products segment contributed RM59.8 million (RM66.5 million) and the others segment chipped in RM104,000 (RM587,000).
In the current quarter under review, the group had recognised a gain of RM8.4 million from the changes in the fair value of the biological assets as compared to a gain of RM0.7 million in 1Q2023.
The company’s earnings per share expanded to 9.82 sen from 8.92 sen. The company has declared an interim dividend of 15 sen per share as compared to 10 sen per share in 1Q2023 to be paid on July 2, 2024.
“For the quarter under review, the group recorded a revenue of RM352.41 million which is at par with revenue of RM350.65 million in the corresponding quarter in 2023. Correspondingly, the group’s profit before tax stood at RM56.83 million for the quarter under review as compared to RM55.8 million of the corresponding quarter in 2023.
“The marginal variation in performance was mainly due to lower sales volume from the timber sector but was offset by the improvement in sales of palm kernel shell segment,” Ta Ann said in its financial results.
In the immediate preceding quarter (4Q2023), Ta Ann delivered stronger earnings with group pre-tax profit of RM83.29 million (1Q2024: RM56.83 million) on higher revenue of RM455.68 million (RM352.41 million).
The weaker performance in 1Q2024 was mainly attributed to the lower sales volumes of crude palm oil (CPO), fresh fruit bunches (FFB) and plywood products by 32 per cent, 35 per cent and 32 per cent respectively despite higher average selling price for CPO and FFB by eight per cent and 11 per cent respectively.
Ta Ann owns 13 oil palm estates spanning a total land area of 72,499 hectares in Sarawak as of Dec 31, 2023. The group also owns and operates three palm oil mills.
In timber, the group operates three active forest management units in the Rejang area, central Sarawak, covering a total area of 346,021 hectares. On planted forest, the group has 31,000 hectares, mainly of acacia mangium species.
On prospects for the current financial year, Ta Ann said the global economic outlook is expected to be uncertain throughout 2024 in view of the on-going escalation of the geopolitical conflicts. The group expects the market to stabilise after the US presidential election later this year.
“During the review period (1Q2024), the plywood demand sentiment remained weak due to the depreciation of the Japanese yen amid a better outlook for the group’s timber section with higher production volume supported by stable market demand.
“The focus of the group’s plantation sector remains at achieving higher yield growth through strong and focusedmanagement.”
Ta Ann said the group continues its exploration for new opportunities to create further growth in profitability and shareholders’ returns.
“Barring any unforeseen circumstances, the board of directors anticipates to achieve a satisfactory performance for 2024,” it added.
