TSH Resources group chairman Datuk Kelvin Tan said
KUALA LUMPUR: TSH Resources Bhd
's earnings surged 177% to RM30.69mil in the third quarter ended Sept 30, 2017 from a year ago, boosted by higher fresh fruit brunches (FFB) production and higher crude palm oil (CPO) selling price.
The Sabah-based plantation company said on Wednesday its core profit before tax (PBT) rose 70% to RM51.6mil from RM30.30mil a year ago. Earnings per share were 2.23 sen compared with 0.82 sen.
TSH generated 43% upswing in FFB production to 212,342 tonnes from 151,297 tonnes a year ago.
“Strong FFB production growth was the main reason contributing to the higher PBT, coupled with higher CPO selling price of RM2,576 experienced in 3Q 2017. Operational cost efficiency has also improved as reflected in gross profit margin of 41% for 3Q 2017 from 36% for the same quarter last year,” it said.
TSH's FFB production upsurge was due to the improvement in the yield of its overall oil palm plantations which are leaving behind the lagged effect of the major 2015 El Nino drought phenomenon.
“About 60% of TSH’s plantation trees are still young, namely immature or young matured.
“They are expected to improve FFB production and continue on a growth path as more oil palm trees are approaching optimum production yield and more planted areas are going into harvesting phase,” it said.
Group chairman Datuk Kelvin Tan said “unit cost of production is likely to benefit and trend lower given the step-up in FFB yield in comparison to last year.
“Putting together higher FFB production and possible decrease in unit cost of production, the company has reasons to be confident with its longer term profitability,” he said.
In the nine-months ended Sept 30, 2017 its earnings rose 15.9% to RM93.20mil from RM79.65mil in the previous corresponding period. Its revenue was up 27.9% to RM803.55mil from RM628mil a year ago.
Core PBT was RM131mil versus RM81.6mil a year ago. The core PBT was derived after adjusting for foreign exchange translation gain or loss.
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