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Tuesday, November 17, 2015

Ta Ann earnings up on palm oil, forex

PETALING JAYA: Ta Ann Holdings Bhd posted better third-quarter and year-to-date earnings, thanks to a much higher palm oil contribution and favourable exchange rates boosting prices of exported logs and plywood.
Announcing its interim results to Bursa Malaysia, the timber and oil palm plantation company said it earned RM67.42mil in the quarter ended Sept 30 (Q3), a 54.6% jump from a year earlier, on 5% higher revenue of RM298.91mil.
This brought total earnings for the nine-month period to RM127.95mil, up 25.4% from the corresponding period last year. The nine-month net profit has already exceeded its entire 2014 net profit of RM125.44mil.
Based on its segmental report, timber products contributed over 70% of its pre-tax profit, followed by oil palm at just under 30%.
The Sibu-headquartered plantation firm said although sales volumes for export logs and plywood fell 31% and 9% respectively, their respective average selling prices in ringgit terms were 41% and 26% higher year-on-year.
Another main contributor to Ta Ann’s better performance was 8% higher fresh fruit bunch (FFB) production from the increasing mature palms.
Oil palm’s contribution to pre-tax profit in Q3 at RM34.04mil was more than double the combined contribution of RM12.64mil registered in the first two quarters.
The third and final reason given for the improved performance was the higher profit from its Tasmania mill operation, which began to generate profit in 2015. According to Ta Ann’s annual report, a new plywood line with an annual capacity of 48,000 cu m is scheduled to start operation in the first half of this year.
On the nine-month period’s performance, it attributed the improvement to higher FFB and crude palm oil production (by 11% and 14% respectively) and better average selling prices of export logs and plywood (by 28% and 13% respectively).
The board has declared a second interim dividend of 10 sen per share in respect of this financial year, payable on Dec 22, 2015.
Ta Ann shares gained 1 sen to close at RM4.09 yesterday.

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