High op­er­at­ing costs dent Boustead’s Q2 earn­ings

The Sun (Malaysia) - - SUNBIZ -

PETALING JAYA: Boustead Hold­ings Bhd’s net profit plunged 73.7% to RM59.3 mil­lion for the sec­ond quar­ter ended June 30, 2017 against RM225.8 mil­lion in the pre­vi­ous cor­re­spond­ing pe­riod, due to higher op­er­at­ing costs.

Rev­enue, how­ever, rose 15.3% from RM2.07 bil­lion to RM2.39 bil­lion.

The group has pro­posed an in­terim div­i­dend of three sen per share for the quar­ter un­der re­view.

Boustead’s six-month net profit plum­meted 68.9% from RM204.3 mil­lion to RM63.5 mil­lion on the back of a 21.3% rise in rev­enue from RM3.93 bil­lion to RM4.76 bil­lion.

The group said in a fil­ing with the stock ex­change that for the half-year, the plan­ta­tion di­vi­sion reg­is­tered a lower pre-tax profit of RM85.9 mil­lion com­pared with RM151.2 mil­lion in the same pe­riod a year ago due to the ab­sence of plan­ta­tion land dis­posal gain.

The av­er­age sell­ing price of crude palm oil for the first six months was RM2,969 per tonne, up by RM545 or 22% from RM2,424 in last year’s cor­re­spond­ing pe­riod.

The heavy in­dus­tries di­vi­sion reg­is­tered a pre-tax profit of RM45.9 mil­lion, mark­ing an im­prove­ment from the deficit of RM99.6 mil­lion in the pre­vi­ous year’s cor­re­spond­ing pe­riod, thanks to im­proved con­tri­bu­tion from Boustead Naval Ship­yard.

The fi­nance and in­vest­ment di­vi­sion closed the half-year pe­riod with a higher pre­tax profit of RM40.5 mil­lion ver­sus RM24.6 mil­lion in the same pe­riod last year.

The phar­ma­ceu­ti­cal di­vi­sion recorded a lower pre-tax profit of RM28.7 mil­lion ver­sus RM37.9 mil­lion, while the prop­erty di­vi­sion recorded a deficit of RM15 mil­lion against a pre-tax profit of RM212.2 mil­lion in last year’s cor­re­spond­ing pe­riod.

Look­ing ahead, Boustead ex­pects its six core busi­ness ar­eas to ben­e­fit from the pos­i­tive long-term prospects for the Malaysian econ­omy, which is sup­ported by strong eco­nomic fun­da­men­tals, a sound fi­nan­cial sys­tem, an ac­com­moda­tive mon­e­tary pol­icy as well as the im­ple­men­ta­tion of var­i­ous gov­ern­ment ini­tia­tives.

Boustead Hold­ings shares closed un­changed at RM2.70 yes­ter­day, with 188,600 traded, giv­ing it a mar­ket cap­i­tal­i­sa­tion of RM5.47 bil­lion.

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