KUALA LUMPUR (May 20): Palm oil player TSH Resources Bhd (KL:TSH) reported a 13% year-on-year increase in its first quarter core profit before tax (PBT) to RM34.8 million from RM30.8 million, amid lower fertiliser prices and reduced losses from joint ventures.

The stronger core profit for the three months ended March 31, 2024 (1QFY2024) was recorded despite revenue dipping 3% to RM242.39 million from RM250.3 million in 1QFY2023, due to inclement weather in parts of Indonesia that adversely affected fresh fruit bunch yield — partially offset by a marginal rise in crude palm oil prices — the group said in a statement.

Net profit came in at RM20.07 million versus RM29.43 million previously, largely because 1QFY2023 had recognised an exceptional gain of RM27.6 million from the disposal of 574.56ha of land in Kalimantan, while no such gains were registered in 1QFY2024.

TSH said its financial position has continued to strengthen with group net assets per share and net gearing improving to RM1.50 and 0.01 times, respectively, as at March 31, 2024.

"The group will progressively develop its unplanted land bank over the next few years. Additionally, the group continues to seek strategic opportunities within the green/sustainable segment to complement its long-term shareholder enhancement initiatives," it said.

The group also noted in a bourse filing that CPO prices have traded sideways around RM3,800 per tonne after easing from the height of RM4,500 in early April due to falling oil export, rising CPO stockpile and ample supply of competing vegetable oil.

"Since the end of April, soybean prices have widened their premium against the CPO as devastating flooding in far southern Brazil dampened the expectation of good soybean crop production. In view of this, CPO price is likely to find reasonable support at current level," it said.

It is cautiously optimistic of achieving a satisfactory FY2024.

TSH's share price slipped 1 sen or 0.89% to close at RM1.11 on Monday, giving the group a market capitalisation of RM1.53 billion. Year to date, the stock has gained 14 sen or 14.43%.