KUALA LUMPUR: TH Plantations Bhd posted weaker profits of RM7.19mil in the second quarter of its current financial year from RM7.58mil in the same quarter last year.
Revenue for the quarter was 17% higher at RM155.43mil compared to the same period last year owing to higher production and sales volume as well as higher average realised prices of crude palm oil (CPO) and fresh fruit bunches (FFB).
Despite the improved revenue, the company recorded lower net profit owing to higher effective tax rates incurred by the business in Q2FY17.
The oil palm plantation segment recorded a profit before tax (PBT) of RM23.45mil in Q2FY17, 14% higher compared to RM20.54mil in Q2 last year as a result of improved revenue.
Year to date, profit before tax for the segment was 154% higher than the previous corresponding period at RM56.93mil owing to significantly higher gross profit margin.
The forestry segment recorded a PBT of RM160,000 in Q2FY17, compared to a loss of RM890,000 in the same period last year as a result of higher deferred income on government grant recognised.
Management services recorded a loss before tax of RM3.74mil in Q2FY17 which was RM320,000 higher compared to the previous corresponding quarter.
Moving forward, the group expects "continued recovery in production to drive the group's revenue growth.
"However, with higher inventory levels in the market, commodity prices are expected to weaken particularly in the second half of the year. Nevertheless, the market expects prices to be supported by higher demand for palm oil products."
The group says it is "cautiously optimistic of performing satisfactorily" in 2017.
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