KUALA LUMPUR (Aug 18): Johor Plantations Group Bhd’s (KL:JPG) net profit fell 32% year-on-year to RM51.15 million for the second quarter ended June 30, 2026 (2QFY2026), weighed down by higher production costs even as revenue rose.
The group posted net profit of RM75.19 million in the same quarter a year earlier (2QFY2025). Earnings per share fell to 2.05 sen this quarter from 3.01 sen in 2QFY2025, according to its bourse filing on Tuesday.
Quarterly revenue rose 4.4% to RM415.84 million, from RM398.29 million in 2QFY2025, mainly driven by higher crude palm oil (CPO) sales.
The group said the profit decline was mainly due to higher cost of sales, particularly from increased upkeep and field maintenance, manuring, fresh fruit bunch (FFB) purchases, harvesting and transportation, repair and maintenance, and other operating costs.
The impact was compounded by lower CPO and palm kernel (PK) delivery volumes, which fell 1.1% and 5.8% respectively, although average selling prices for both products were higher.
Internal CPO production costs rose 25.8% to RM2,788 per tonne, from RM2,216 a year earlier.
Internal FFB production also rose 5.2% quarter-on-quarter while external FFB intake jumped 28.4%, lifting total FFB processed by 13%.
Crop production remained affected by the lagged effect of the strong crop cycle in the second half of 2025, lower rainfall in the first quarter of 2026, and a reduction in mature planted area under its accelerated replanting programme.
The group expects FFB production to recover gradually in the third quarter, with peak crop anticipated towards September, subject to favourable weather and stable harvesting operations.
For the six months ended June 30, 2026 (1HFY2026), JPG's average CPO selling price of RM4,459 per tonne exceeded the Malaysian Palm Oil Board's (MPOB) average of RM4,364, while its average PK selling price of RM3,715 per tonne was above MPOB's RM3,551.
The board also declared a second interim dividend of 1.10 sen per share for FY2026, payable on Sept 14 — lower than the 1.25 sen second interim dividend paid a year earlier.
For 1HFY2026, net profit fell 32.8% to RM101.5 million from RM151.12 million, even as revenue rose 4.6% to RM772.54 million from RM738.72 million.
The group said it is continuing to expand its external certified crop-sourcing network through its Smallholder Inclusion Programme, which now includes 390 RSPO-certified smallholders, while pursuing accelerated replanting and estate improvement initiatives.
Managing director Mohd Faris Adli Shukery said the measures, alongside the development of the group’s Integrated Sustainable Palm Oil Complex (iSPOC), are aimed at strengthening JPG’s integrated value chain and supporting long-term value creation.
Phase 1 of iSPOC entered commissioning in 3QFY2026 and remains on track to commence commercial operations by year-end.
"Looking ahead, the group expects the palm oil market to remain supported by seasonal restocking demand, Indonesia's B50 biodiesel mandate and the seasonal peak crop cycle," JPG said.
"Nevertheless, the group will continue to monitor external developments, including the anticipated El Niño event, evolving geopolitical tensions in the Middle East and the implementation of the European Union Deforestation Regulation (EUDR)," it added.
As of Tuesday’s close, JPG was unchanged at RM2.05, giving it a market capitalisation of RM5.12 billion. Year to date, the counter is up more than 30%.