KUALA LUMPUR (Aug 28): Oriental Kopi Holdings Bhd (KL:KOPI) saw its third-quarter net profit fall 5% despite a 34% jump in revenue, as higher raw material and store operating costs compressed margins while expansion-related expenses pushed up its effective tax rate.

Net profit for the three months ended June 30, 2026 (3QFY2026) fell 5.3% to RM17 million from RM17.95 million a year earlier, even as revenue surged 34.2% to RM156.63 million from RM116.75 million, according to its filing with Bursa Malaysia on Friday.

The revenue growth came as Oriental Kopi continued expanding its café chain operations alongside its distribution and retail business for packaged food products. 

That, however, did not translate into comparable bottom-line growth as higher raw material costs and store operating expenses compressed the group's gross profit margin to 23.48% from 25.98% a year earlier. 

Its effective tax rate also rose to about 31%, above Malaysia's statutory corporate tax rate of 24%, mainly due to non-deductible pre-commencement and start-up expenses incurred for newly opened outlets.

No dividend was declared accompanying the latest quarterly result. As at end-June, Oriental Kopi had RM490.14 million in cash and bank balances against just RM3.04 million in borrowings. 

"The group remains optimistic about its prospects, supported by its competitive strengths, strategic business initiatives, and favourable market conditions in the F&B [food and beverage] services sector as well as in the distribution and retailing of our brand of packaged foods," the group said. 

For the nine months ended June 30, 2026 (9MFY2026), its net profit increased 9.4% to RM49.08 million, while revenue surged 39% to RM443.08 million, overall thanks to further expansion and growth of the cafe chain operations as well as the distribution and retail of packaged foods.