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Thursday, August 25, 2016

Boustead gains from sale of assets

Thursday, 25 August 2016
Boustead gains from sale of assets

KUALA LUMPUR: Boustead Holdings Bhd’s pre-tax profit jumped to RM322.5mil for the second quarter ended June 30, 2016 from RM83.3mil recorded in the same period last year, thanks to the disposal of assets related to its property and plantations business segments.

Revenue, however, declined to RM2.07bil from RM2.21bil previously.

For the first six months of this year, the company posted a stronger pre-tax profit of RM358.8mil, from RM152.8mil previously, on the back of a lower revenue of RM3.93bil versus RM4.1bil achieved in the corresponding second half.

In a statement, the company said its property division was the biggest contributor with a higher profit of RM201mil for the first half of the year, on the back of a gain on disposal of its associate company Jendela Hikmat Sdn Bhd amounting to RM198mil.

However, this division’s performance mitigated by a weaker performance by the hotel segment and unrealised foreign exchange loss.

The plantation division turned in a stronger profit of RM145mil for the half-year period, mainly due to a gain on the disposal of land amounting to RM118mil, coupled with better palm product prices.

Boustead’s plantation’s average crude palm oil selling price for the first half of the year was RM2,424 per tonne, up by 10% from the corresponding period.

The higher prices came about from a drop in fresh fruit bunches production to 398,418 tonnes, largely due to the dry weather conditions resulting from the El Nino phenomenon, land disputes in Sarawak and a labour shortage for harvesting tall palms.

It said the trading and industrial division registered an increased profit of RM51mil for the six-month period, on the back of stronger contributions from UAC Bhd and Boustead Petroleum Marketing Sdn Bhd, as well as gains realised from the disposal of assets by Johan Ceramics Bhd.

The Pharmaceutical division posted a lower profit of RM38 million for the first six months, mainly due to higher amortisation and increased finance cost while the finance and investment segment, anchored on Affin Banking group, recorded an improved profit of RM25 mil for the six-month period.

Deputy chairman and group managing director Tan Sri Lodin Wok Kamaruddin said the strong growth in most of its divisions showed the group’s resilience.

“In line with this performance, we have declared a second interim dividend of four sen per share for the financial year ending Dec 31, 2016, which will be paid on Sept 30, 2016 to shareholders on the register as at Sept 14, 2016.

“Due to the group’s enlarged share capital as a result of the rights and bonus issue earlier this year, total dividends to be paid out will amount to RM81mil,” he added.

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