KUCHING:A double-digit increase in the selling prices of tropical logs and oil palm fruits has given a major lift to Jaya Tiasa Holdings Bhd’s latest quarterly results.
Pre-tax profit for the third quarter as at March 31 this year (3Q-2014) soared by nearly five-fold to RM15.7mil from RM3.3mil in 3Q-2013, while revenue expanded to RM254.4mil from RM236.3mil.
“The higher revenue was due to a 40% increase in fresh fruit bunches (FFB) sales volume while the higher pre-tax profit was contributed by a 17% and 7% increase in logs and plywood average selling prices respectively, as well as a 22% improvement in FFB average selling price,” the group said in explanatory notes to its latest financials.
On a nine-month basis, pre-tax profit surged to RM70.9mil from RM23.7mil despite a drop in revenue to RM762.9mil from RM796.9mil previously, attributable to the decline in logs and plywood sales volumes.
Logs sales contributed RM244.7mil in revenue and RM53.3mil in pre-tax profit against RM291.6mil and RM4.97mil respectively in the first nine months of the previous financial year.
In the latest nine-month period, Jaya Tiasa registered a 19% and 10% jump in logs and plywood average selling prices respectively.
“Against the October-December period in 2013, our pre-tax profit in the latest quarter declined sharply to RM15.2mil from RM29.7mil due to seasonal factors,” said Jaya Tiasa, adding that lower earnings were derived from a 13% and 21% drop in logs and plywood production volumes respectively, as well as a 29% reduction in both FFB and crude palm oil (CPO) outputs.
On prospects, Jaya Tiasa said the outlook for its timber business was expected to remain positive in view of the recent ban on export of logs by Myanmar, coupled with stable economic conditions in India and Asia regions which should lead to sustainable demand for logs and wood products.
“CPO prices are expected to remain firm due to supply constraints arising from the recent drought and high possibility of El Nino occurring in the coming months as well as the anticipated increase in demand for edible oils during Ramadan,” it added.