Boustead posts RM27.6m net loss in Q2


PETALING JAYA: Boustead Holdings Bhd swung to the red registering a net loss of RM27.6 million for the second quarter (Q2) ended June 30, 2018 compared with a net profit of RM52.5 million due to reduced contributions from the plantation, heavy industries and property divisions.

Revenue was down 0.5% to RM2.37 billion from RM2.39 billion.

The group has proposed to declare an interim dividend of 1 sen per share for the quarter under review.

Boustead said in a filing with the stock exchange that the plantation division registered a deficit of RM26.2 million, mainly due to weaker palm product prices, lower fresh fruit bunches (FFB) production and higher expenditure.

Average crude palm oil (CPO) price for Q2FY18 was RM2,421 per metric tonne (MT), a drop of RM70 from RM2,491 per MT in Q1FY18.

Meanwhile, average palm kernel price for Q2FY18 was RM1,791 per MT, a reduction of RM397 from RM2,188 per MT in Q1FY18.

Boustead said CPO prices came under pressure due to lacklustre exports caused by the reinstatement of CPO export duty in May 2018 and the US- trade conflicts which had led to a sharp drop in soy prices.

The group opined that the price direction for palm oil for the rest of the year is likely to be governed by the production trend from Indonesia and , soybean supplies, biodiesel offtake in Indonesia, demand, development of US China trade tensions and its implications on prices of crude mineral oil.

“The division is cautiously optimistic that palm will pick up in the last quarter of 2018.”

The heavy industries division incurred a higher deficit of RM17.2 million in Q2FY18, largely due to lack of projects undertaken by Boustead Naval Shipyard Sdn Bhd.

The property division also posted a higher deficit of RM10.6 million as the improved contribution from property development activity was negated by higher share of loss from Boustead Ikano.

Boustead reported a net loss of 21.5 million for the first half of the year from a net profit of RM48.5 million in the same period a year ago, with revenue declining 3% to RM4.62 billion from RM4.76 billion.

In a separate filing, the group proposes to extend further the time frame for the utilisation of balance of proceeds from its amounting to about RM408 million by 19 months from June 23, 2018 to December 31, 2019. The proceeds are allocated for property development activities.

At the midday break, Boustead’s gained 3 sen or 1.5% to RM2.05 on 142,300 shares done.

Source: The Sun Daily

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