KUALA LUMPUR (Nov 13): United Plantations Bhd (KL:UTDPLT) announced on Wednesday a 60 sen per share dividend payout — comprising a special dividend of 20 sen and an interim dividend of 40 sen — together with a one-for-two bonus issue, as it reported an 8.8% drop in its third quarter net profit following a jump in operating expenses.
The group, whose share price just touched its all-time high a day earlier, reported that net profit for its third quarter ended Sept 30, 2024 (3QFY2024) dropped to RM215.03 million from RM235.68 million in 3QFY2023, as operating expenses jumped over RM80 million, though that was partly offset by higher other operating income and an increased share of results from joint ventures.
Quarterly revenue was 1.4% higher at RM547.67 million in 3QFY2024 from RM540.16 million in 3QFY2023, due to an increase in revenue from its refinery segment as a result of higher crude palm oil (CPO) and palm kernel (PK) prices, as well as higher sales volume.
For its cumulative nine months ended Sept 30, 2024, United Plantations' net profit grew 5.3% to RM533.84 million from RM506.79 million, as revenue rose 6.8% to RM1.57 billion from RM1.47 billion.
However, the 60 sen payout it announced, which will be paid on Dec 10, is lower than the 80 sen per share it declared during the same quarter in FY2023.
As for the bonus issue it announced to reward shareholders — on the basis of one bonus share for every existing two shares held — United Plantations said the entitlement date will be fixed and announced later.
Going forward, the group said key factors to watch out for during the final quarter of the year will be how production in Malaysia and Indonesia perform and if there will be any significant stock builds.
“So far, exports continue to surprise positively combined with a slowdown in production which has kept a lid on further stock build,” it said.
Meanwhile, amid the global uncertainties and challenges, the group said it remains focused on its operations and is taking various means to improve yields, productivity and to reduce costs.
“This aim is pursued through ongoing mechanisation initiatives and through the replanting of older, less productive oil palm stands with our latest in-house high yielding planting materials.
“These efforts are vital for our ability to remain competitive and profitable as increasing labour costs, energy, chemicals and building materials are expected to exert upward pressure on our cost base,” it noted.
It expects its performance for FY2024 to be satisfactory, based on the improved palm oil prices and the group’s focus on securing the budgeted crop in the remaining part of 2024.
Shares of United Plantation closed two sen or 0.1% lower at RM29.64 on Wednesday, giving it a market capitalisation of RM12.34 billion. Year to date, the stock has climbed over 66%.