KUALA LUMPUR (May 7): SD Guthrie Bhd (KL:SDG), the world’s largest palm oil producer by acreage, saw its net profit more than double in the first quarter of 2025, driven by a stronger performance of its upstream segment, which offset lower profits from the downstream segment.

Net profit for the three months ended March 31, 2025 (1QFY2025) rose to RM567 million from RM211 million a year earlier. Revenue came in at RM4.82 billion, up 11% year-on-year (y-o-y) from RM4.34 billion, the group said in a bourse filing.

The upstream segment's recurring profit before interest and tax (PBIT) nearly tripled to RM753 million from RM265 million, supported by higher average realised crude palm oil (CPO) and palm kernel (PK) prices, along with increased fresh fruit bunch (FFB) production.

The average realised CPO price rose 18% y-o-y to RM4,576 per metric ton (MT) in 1QFY2025 from RM3,880 per MT, while PK prices surged 72% to RM3,342 per MT from RM1,940 per MT.

Meanwhile, the group's downstream arm recorded a 37% decline in PBIT to RM76 million, from RM121 million in the previous corresponding quarter, due to lower margins and weaker demand — particularly in Europe — partly cushioned by a stronger performance in the Asia-Pacific region.

No dividend was declared for the quarter under review.

SD Guthrie expects CPO prices to soften in the near term, citing improved weather boosting supply and reduced biodiesel demand amid low crude oil prices.

Although US tariffs are unlikely to have a direct impact on Malaysian CPO, the group said they contribute to price volatility and may increase operational costs due to global supply chain disruptions.

Despite market uncertainty, the group anticipates a modest improvement in FFB output and sees opportunities to expand its downstream footprint, as well as grow its presence in industrial park development and renewable energy.

Group managing director Datuk Mohamad Helmy Othman Basha said the company remains vigilant of economic and geopolitical risks but is confident in delivering a solid performance for FY2025.

“On a positive note, our industrial park growth pillar achieved a significant milestone with the recent signing of a tripartite agreement for the development of the group’s prime land in Bukit Pelandok, Negeri Sembilan, located within the Malaysia Vision Valley 2.0 growth corridor,” he said.

At the midday break on Wednesday, shares in SD Guthrie had risen one sen or 0.2% to RM4.68, giving the company a market capitalisation of RM32.4 billion. Year to date, the stock has declined by 5.45%.