KUALA LUMPUR (Nov 29): Palm oil producer Kretam Holdings Bhd (KL:KRETAM) said on Friday its net profit surged in the third quarter from a year earlier as accounting gains more than offset a drop in revenue from lower output and sales.

Net profit for the three months ended Sept 30, 2024 (3QFY2024) was RM47.3 million, a 91% increase compared to the same period last year, Kretam said in an exchange filing. The company booked a fair value gain on investment securities of RM33.9 million during the quarter.

Revenue meanwhile fell 6% year-on-year to RM160.4 million compared to the same quarter in 2023 amid decline in both fresh fruit bunches production and crude palm oil sales volume.

Kretam, however, remains optimistic about its 2024 outlook supported by current palm oil prices and management's efforts to improve performance.

"We will take additional steps to mitigate sector-related risks through prudent cost management, and by boosting yield and productivity in 2024," the company noted.

Kretam also declared the first interim dividend of half a sen per share, payable Dec 30, 2024. 

For the first nine months, net profit surged 89% to RM99 million while revenue dropped 9% year-on-year to RM496.7 million. The company noted that it booked fair value gain in quoted investments of RM54.4 million which is non-taxable, helping to lower its tax expenses below the statutory tax rate.

The company had RM188.15 million in investment in quoted securities on its balance sheet at the end of September.

Shares of Kretam were last traded on Nov 27 at 61 sen, giving the company a market capitalisation of RM1.42 billion ahead of the results announcement.