KUALA LUMPUR: SD Guthrie Bhd
does not expect any near-term impact from the US tariffs, says group managing director Datuk Mohamed Helmy Othman Basha.
According to him, while it does export to the United States, it only consists of very small volumes – about 2% only.
“The fact is, products can only come from Malaysia or Indonesia, and as Indonesia has the same tariff rates, we don’t see any impact at all, at least not in the immediate term,” he told reporters after the group’s second-quarter results announcement here yesterday.
The palm oil producer posted a higher net profit of RM505mil for the second quarter ended June 30, 2025 as well as a higher revenue of RM5.17bil, compared to RM4.97bil in the same quarter last year.
Mohamed Helmy said the increase in earnings was on the back of strong results from its upstream segment.
“We have a bit of a double tailwind in the sense that we expect production to remain strong for our operations. We also expect crude palm oil (CPO) prices to stabilise at around RM4,000 and RM4,100 for the rest of the year,” he noted.
The group’s downstream segment, however, faced a number of headwinds.
This segment was the only negative in its results, registering RM126mil in profit before interest and taxes, a decrease from the RM225mil posted in the same quarter last year.
The drop was due to weaker profits generated by the refineries and operations across Asia Pacific and Europe, impacted by both lower margins and reduced volume demand, further compounded by the lower share of profits from joint ventures.
For the six-month period ended June 30, 2025, SD Guthrie’s net profit rose to RM1.07bil against RM626mil in the same period last year, while revenue grew to RM9.99bil from RM9.31bil in the first half of 2024.
Similar to its quarterly earnings, the increase was mainly due to strong upstream operations, which resulted from higher year-on-year (y-o-y) average realised CPO and palm kernel prices which rose by 3% and 50% y-o-y to RM4,146 and RM3,247 per tonne, respectively.
On top of that, its fresh fruit bunch (FFB) production increased by 4%, as all segments registered higher FFB production.
Moving forward, Mohamed Helmy said he expects the upstream segment to carry more of the growth for this year.
He opined that the rest of the year will continue to have a positive trajectory.
Among the key drivers include the two business pillars the group has been focusing on lately – industrial parks and renewable energy.
“These two pillars have gained traction, but there is still a lot of work in the pipeline.
“Some have translated into joint ventures and we expect profit recognition by the third quarter,” he said.
He added that by 2030, the plan is that the two business pillars will contribute nothing less than RM700mil to RM800mil to the group’s bottom line.
“That should be close to about 30% to the overall contribution” he noted.
Meanwhile, Mohamed Helmy said while the group has been aware of the impact in terms of costs related to the 5% charge from the sales and service tax, it is hoping for an exemption.
“There is a request in relation for an exemption for this. We are hoping to hear about the exemption and chances are, it will come in.”
