KUCHING: Ta Ann Holdings Bhd has posted higher group net profit of RM93.74 million in third quarter ended September 30, 2024 (3Q2024) from RM84 million a year ago, boosted by improved average selling prices of crude palm oil (CPO) and fresh fruit bunches (FFBs).
Also contributing to the profit growth was the recognition of higher gain by RM7.33 million in the fair value changes in biological assets in the current quarter under review.
Group revenue, however, fell to RM467.6 million from RM489.2 million in 3Q2023.
Company’s earnings per share rose to 16.88 sen from 14.79 sen, and the company has declared an interim dividend of 20 sen per share, up by 5 sen from 15 sen in 3Q2023.
“The group’s pre-tax profit stood at RM105.08 million for the quarter under review as compared to RM103.29 million of the corresponding quarter in 2023. Better performance was mainly attributed by higher average selling price for CPO and FFB by 9% and 5% respectively.
“The group had recognised a gain of RM12.23 million from the changes in the fair value of the biological assets during the quarter under review as compared to a gain of RM4.9 million in the preceding quarter,” Ta Ann said in explanatory notes to its financial results.
The 3Q2024 financial results were a significant improvement as compared to the immediate preceding quarter (2Q2024) when group revenue recorded was sharply lower at RM366.73 million and pre-tax profit was RM54.25 million.
“The performance was improved attributable to higher export logs, FFB and CPO sales volumes by 71%, 45% and 34% respectively,” it added.
In the first nine months of 2024 (9m2024), Ta Ann recorded higher group net profit of RM205.1million (9m2023: RM181.38 million) despite a drop in revenue to RM1.186 billion (RM1.225 billion).
In 9m2024, Ta Ann’s oil palm segment generated RM1.027 billion in revenue (RM986.53 million) while the timber products segment contributed lower revenue of RM157.85 million (RM236 million). The others segment chipped in lower revenue of RM2.3 million (RM2.49 million).
The oil palm segment pre-tax profit rose to RM219.67 million (RM183 million) but the timber products segment slipped into the red with pre-tax loss of RM4.79 million (+RM33.46 million) while the others segment (including property and energy divisions) reported lower pre-tax profit of RM1.27 million (RM1.79 million).
Ta Ann attributed the improved group earnings in 9m2024 to higher average selling price achieved for CPO and FFB by six per cent and four per cent respectively despite weakening export logs and plywood products’ average selling prices by 14 per cent and 11 per cent respectively.
“The group had recognised a gain from the changes in the fair value of biological assets amounting to RM40.54 million during the current period under review as compared to a gain of RM16.3 million in the preceding corresponding period,” said the company.
On prospects for the current financial year ending December 31, 2024, Ta Ann said the group remains committed to on-going improvements in operational efficiency across both its timber and oil palm segments.
“However, the persistently weak market demand for timber products has resulted in relatively low prices which continued to place pressure on the profit margins in the timber segment.
“On a positive note, the recent CPO prices have surged above RM5,000/MT, the highest level since July 2022, enabling the group to achieve an improved profit margins in its oil palm division,” added the company.
