KUALA LUMPUR (March 2): PPB Group Bhd (KL:PPB) does not expect further impairments on its 18.8%-owned associate Wilmar International Ltd (SG:WILMAR INTL), after fully writing down the goodwill component of its investment.

PPB group managing director Lim Soon Huat said the RM4.17 billion impairment recognised in its financial year ended Dec 31, 2025 (FY2025) was prompted by a "prolonged gap" between PPB’s carrying value of its Wilmar investment and Wilmar's market share price, a trend that has been persisting since 2021.

“Market price of Wilmar has been long at a level below our carrying value, which comprises the share of NAV (net asset value) and also the goodwill. This is just prudent for us to write it down so that the gap will not be too big,” Lim said during a press briefing on Monday.

Lim emphasised that the impairment is a one-off, non-cash accounting entry to adjust Wilmar's carrying value to its net asset value, adding such adjustments do not impact the group's operating cash flow or its ability to pay dividends.

"It is unlikely for any further impairment at PPB level with impairment of the goodwill being fully impaired,"  Lim added.

PPB proposed maintaining its total dividend at 42 sen per share for FY2025.

As at end-2025, the group has over RM2 billion in cash against borrowings of about RM200 million, which Lim described as a strong balance sheet position.

Addressing concerns over Wilmar's ongoing legal proceedings in Indonesia and China, PPB expressed continued confidence in the associate's long-term resilience.

“What Wilmar is going through is that the court proceeding is still in the process of appeal. It is disclosed publicly by Wilmar. We do not believe it will affect Wilmar’s long-term prospects, particularly in China and Indonesia.

He highlighted that both markets offer strong growth prospects, adding: "Given Wilmar’s resilience capabilities and also integrated business model, it is well positioned to navigate the challenging times and emerge stronger."

He also said the legal cases are being handled by Wilmar, and PBB is not involved in the associate's day-to-day management.

Read also:
PPB’s 4Q operating profit surges to RM1.03b from RM422m a year ago, but bottom line hit by large Wilmar impairment
PPB's Wilmar hit with another fraud verdict, found jointly liable for RM1.1 bil compensation in China