TSH
KUALA LUMPUR: Higher fresh fruit bunches (FFB) production and stringent cost controls saw TSH Resources Bhd
's core profit before tax (PBT) jump 38% to RM180mil for FY ended Dec 31, 2017.
The Sabah plantation company said on Tuesday it expected to sustain its FFB production growth in 2018 and onwards, aided by oil palm trees with higher yielding ages, in view of the increasing maturity of the trees.
Commenting on its results, TSH said the core PBT for FY17 was higher than the RM130mil in FY16 mainly due to the increase of FFB production by 19% to 710,105 tonnes from 595,821 tonnes in FY16 and also due to stringent cost controls.
TSH said that its core PBT was derived after adjusting non-cash and unrealised exchange translation gain or loss. Its FY17 revenue rose 23% to RM1.07bil from RM872.30mil while it recorded gain on foreign exchange of RM16.74mil compared with a loss on forex of RM17.52mil.
It proposed a single tier dividend of two sen per share for FY17.
In the fourth quarter ended Dec 31, 2017, TSH posted RM48.7mil core PBT compared with RM48.5mil a year ago. While earnings were RM21.62mil, it recorded net losses of RM21.77mil a year ago due to loss on foreign exchange of RM39.41mil. Revenue rose 11% to RM269.95mil from RM244.30mil a year ago.
Commenting on the results, TSH said FFB production had peaked earlier in the third quarter of 2017 compared with the fourth quarter for 2016.
TSH’s 19% FFB growth in 2017 was due to stronger production driven by growing maturity profile and expanding harvesting area.
It said the oil palm trees were continuing with their steady recovery after the poor harvest in 2016 caused by the El Nino phenomenon. In line with this trend, the company expects to sustain its FFB production growth in 2018 and onwards, aided by oil palm trees with higher yielding ages, in view of the increasing maturity of the trees.
This expectation is buoyed by good weather conditions recorded by TSH’s plantations in Malaysia and Indonesia throughout 2017 which would have a favourable effect on the FFB production in the subsequent years.
TSH’s group chairman, Datuk Kelvin Tan said: "Improving FFB output coupled with cost-control, would continue to lower unit cost of production and raise profitability insofar as CPO price can maintain at the current level. We remain confident that the performance of TSH will remain positive for year 2018."
Win a prize this Mother's Day by subscribing to our annual plan now! T&C applies.
