KUALA LUMPUR (Feb 28): Batu Kawan Bhd (KL:BKAWAN) posted a 14.2% rise in net profit for the first quarter ended Dec 31, 2024 (1QFY2025), driven by higher selling prices of palm products, sales volume as well as a paper gain.

Net profit for 1QFY2025 increased to RM127.6 million from RM111.74 million in the same period a year ago, according to the group’s bourse filing on Friday.

Quarterly revenue edged up 5% to RM6.12 billion in 1QFY2025 versus RM5.83 billion in 1QFY2024. No dividend was recommended for 1QFY2025.

Batu Kawan’s plantation segment, which comprises the group's 48.2%-owned unit Kuala Lumpur Kepong Bhd (KL:KLK), posted a 55.6% rise in profit before tax (PBT) of RM585.08 million in 1QFY2025, due to higher crude palm oil (CPO) and palm kernel selling prices, coupled with higher CPO sales volume, further supplemented by a fair value gain of RM34.72 million on the valuation of unharvested fresh fruit bunches (FFB).

On the group’s other segments, its manufacturing segment logged a loss before tax (LBT) of RM34.65 million in 1QFY2025 versus a profit before tax of RM40.29 million a year ago, despite higher revenue.

The property development segment saw its PBT fall 37.6% to RM7.55 million on the back of a 37.3% decline in revenue.

Meanwhile, its investment holding and others segment logged a wider LBT of RM106.5 million in 1QFY2025 as compared to RM38.48 million in 1QFY2024, due to the booking of an unrealised foreign exchange loss of RM39.5 million versus a forex gain of RM8.21 in 1QFY2024, among others. 

Looking to the remaining quarters of the financial year, Batu Kawan remains optimistic of a year-on-year improvement in financial performance, citing the expectation for CPO prices to stay above RM4,000 per metric tonne (MT).

“While CPO prices have been volatile, reaching RM5,200 per MT in November 2024, they remain robust currently around RM4,700 per MT level, supported by higher soybean oil prices and tightened palm oil inventories,” the group said.

Shares in Batu Kawan ended eight sen or 0.41% higher at RM19.60 on Friday, valuing the group at RM7.83 billion.

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