KUALA LUMPUR (Aug 18): Mega First Corp Bhd (KL:MFCB) saw its second-quarter net profit fall nearly 30% year-on-year, dragged down by wider losses from its joint venture and softer contributions from its renewable energy and resources divisions.

The group made a net profit of RM59.39 million for the quarter ended June 30, 2026 (2QFY2026), down from RM84.77 million in 2QFY2025, its bourse filing showed. Revenue slipped 3.3% to RM328.72 million from RM339.92 million as it recorded lower top-line figures across renewable energy, resources and investment holding, which were partially offset by a 14.7% revenue expansion in the packaging division.

The group's share of losses from joint ventures and associates more than doubled to RM34.78 million from RM16.35 million previously. This was driven by Edenor Technology Sdn Bhd, following the appointment of interim judicial managers and the recognition of retrenchment expenses.

Profitability was also dampened by the commencement of a 5% corporate tax on Lao hydropower income starting from Jan 1, 2026, and a one-off prior-years tax charge of RM1.59 million in the packaging division.

The group declared an interim dividend of 5 sen per share for the FY2026, up from 4.75 sen a year ago, with entitlement and payment dates to be announced later.

For the first half ended June 30 (1HFY2026), the group's net profit fell 17.5% to RM121.74 million from RM147.56 million in 1HFY2025 as revenue retreated 6.77% to RM633.68 million from RM679.69 million.

Commenting on its renewable energy division, Mega First said the Don Sahong hydropower plant in Laos enters the second half with improved availability after completing two scheduled turbine overhauls in March and June. Generation in 2HFY2026 is projected to surpass 1H levels, aided by the wet season.

Meanwhile, its solar pipeline remains on track, with its 51 MWp Corporate Green Power Programme (CGPP) and 11.4 MWp Maldives projects slated to begin commercial operations in the third and fourth quarter respectively.

On its 50%-owned Edenor joint venture, Mega First said the oleochemical production plant has been shut down after being placed under judicial management during the quarter and that most employees have been retrenched while the judicial manager seeks a buyer.

“This means the ultimate impact on Mega First’s earnings remains indeterminate as it will depend on the specific terms of any eventual sale,” it noted.

Nevertheless, the operating drag from Edenor is expected to decline significantly in 2HFY2026 following the cessation of production, leading to lower expenses.

Besides operating renewable power assets, Mega First is also involved in the quarrying of limestone and trading of lime products as well as the production of flexible packaging materials and labels.

Renewable energy remained its largest top-line contributor in 1HFY2026, at 41.8% of total revenue, followed by the packaging division (35.9%), resources (12.7%) and investment holding and others (9.5%).

Mega First shares closed unchanged at RM2.85 on Tuesday, valuing the group at RM2.82 billion. Year to date, the stock has declined 14.93%.