KUALA LUMPUR (Nov 28): PPB Group Bhd's (KL:PPB) net profit for the third quarter ended Sept 30, 2024 (3QFY2024) fell 44.1% to RM208.12 million, from RM372.55 million a year earlier, largely due to lower contribution from its 18.8%-owned associate Wilmar International Ltd, as well as lower profit from its core business segments.
Wilmar, the integrated agribusiness giant, contributed RM205 million during the quarter compared with RM268 million in 3QFY2023, while the core business segments' profit saw a sharp fall of 97% to RM4 million from RM131 million.
PPB's earnings per share for the quarter dropped to 14.63 sen from 26.19 sen previously, its bourse filing on Thursday showed.
Quarterly revenue dropped 7.5% year-on-year to RM1.35 billion from RM1.46 billion, mainly due to the absence of contribution from its Indonesian flour operations which was divested in September 2023.
The group’s grains and agribusiness segment posted a decrease in profit by 88% to RM11 million from RM96 million in 3QFY2023, attributable to a lower profit recorded by key sub-segments of flour, livestock, maize, and soybean meal.
The revenue of its other segments — consumer products, film exhibition and distribution, as well as property — all posted declines, which resulted in lower profit and deeper losses.
The group did not declare any dividends for the quarter.
For the nine months ended Sept 30, the group's net profit dropped 10.4% to RM854.21 million from RM952.91 million a year earlier, with revenue dipping 11.3% to RM3.96 billion from RM4.46 billion. Contribution from Wilmar during the period amounted to RM715 million, compared with RM728 million previously.
Looking ahead, PPB said that its grain and agribusiness would be affected by continued volatility in the global commodity market, with potential adverse weather conditions in key grain-growing regions likely to affect commodity prices.
"Despite these challenges, we continue to leverage our market intelligence, extensive grain procurement experience, and strong technical expertise to deliver consistently high-quality products. We expect the segment’s performance to remain satisfactory for the remainder of the year," it said.
Meanwhile, PPB said the consumer products segment will focus on expanding its product range and strengthening market presence, capitalising on its established marketing and distribution network, and logistical resources. "Although business costs are rising, we anticipate this segment to deliver sustainable profit through the end of the year," it said.
On its film exhibition and distribution segment, PPB noted that the fourth quarter results will be heavily dependent on the performance of the movie lineup during the holiday period, while management will be focusing on optimising operating costs to enhance overall performance in 2024.
"With several property development projects at various stages of planning, enhancing mall performance will remain as [a] key focus for the property segment in 2024," it added.
Shares in PPB closed unchanged at RM13.28 on Thursday, valuing the group at RM18.89 billion.