KUALA LUMPUR (Nov 19): Malayan Flour Mills Bhd’s (MFM)(KL:MFLOUR) net profit for the third quarter ended Sept 30, 2024 (3QFY2024) plummeted 69.7% to RM7.34 million, from RM24.2 million in the same quarter last year.

In a bourse filing on Tuesday, MFM attributed the plunge in net profits mainly to the bigger losses at PT Bungasari Flour Mills Tbk and the performance of its poultry integration (PI) segment through Dindings Tyson Sdn Bhd (DTSB), which turned a loss, compared with a profit last year.

Revenue for the quarter, however, grew 3.1% to RM799.2 million, from RM774.9 million previously, supported by steady demand in its flour and grain trading segments.

“The improvement in the current quarter's revenue was mainly contributed by higher sales volume from the flour and grain trading segment, amidst lower selling price,” it added.

Earnings per share (EPS) dropped to 0.59 sen from 2.37 sen in the same quarter a year ago. No dividend was declared.

The group's share of losses at PT Bungasari rose to RM10.3 million in 3QFY2024 from RM4 million in the corresponding quarter, as lower sales volume from weaker feed demand and a reduced margin from flour products dragged the Indonesian joint venture’s income further down.

Meanwhile, DTSB turned into red in the quarter, resulting in MFM recording a share of loss of RM2.7 million, compared with a share of profit of RM7.2 million in the corresponding quarter in 2023.

Despite the lower profits in 3QFY2024, MFM’s net profits for the nine-month period ended Sept 30, 2024 (9MFY2024) almost doubled to RM64.07 million, from RM32.68 million, largely due to steady performance in the flour and grain trading segment in Malaysia and Vietnam.

Even so, revenue for the period fell marginally by 2.19% to RM2.3 billion, down from RM2.35 billion in the same period last year.

The PI segment also reported a sharp decline in profit after tax (PAT), falling to RM800,000 in 9MFY2024 from RM55.1 million previously.

“The segment’s PAT declined sharply to RM0.8 million in 9MFY2024 from RM55.1 million previously, due to the impact of a boycott against Western-based fast-food chains following the Middle East geopolitical conflict, as well as the discontinuation of chicken subsidy since November 2023,” it said.

Touching on prospects, the group noted that wheat and grain commodity prices remain volatile, influenced by ongoing uncertainties in macroeconomic conditions and geopolitical factors.

“The group will continue to monitor the impact of commodity prices arising from the global supply and demand dynamics and adjust selling prices accordingly and to diversify the sources of wheat, corn and soybean meal,” it added.

At the close of trade on Tuesday, MFM’s share price was up half a sen or 0.8% at 63 sen, valuing the company at RM774.57 million.