KUALA LUMPUR: Kuala Lumpur Kepong Bhd's (KLK) net profit fell 38.6 per cent to RM117.07 million in the second quarter ended March 31, 2024 (2Q24) from RM190.81 million a year ago, on the back of lower revenue.
The group's quarterly revenue declined 9.8 per cent to RM5.46 billion from RM6.05 billion previously.
Its earnings per share dropped to 10.80 sen from 17.70 sen in 2Q23.
"The current quarter's results have been hampered by the share of equity loss of RM87.2 million from our investment in Synthomer plc," KLK said in a statement.
On a segmental basis, KLK said its plantation segment contributed strongly to the group's results, coming in at a 25 per cent increase to RM357.7 million in 2Q24 compared to RM287.3 million in 2Q23 although having marginal improvement in yields.
The group noted that higher crude palm oil (CPO) sales volume and lower cost per tonne of CPO production are the other key factors contributing to strong results.
Its manufacturing segment posted a profit of RM56.7 million in 2Q24, marking a sharp drop from RM186.0 million in the same period last year.
KLK said although the oleochemical sub-segment in Europe has faced challenges, a more positive outlook is emerging.
The group said its strategic restructuring to move downstream in the value chain is expected to yield positive results.
For the six-month period (1HFY24), KLK's net profit dipped 45.7 per cent to RM344.01 million from RM633.85 million, while revenue declined to RM11.09 billion from RM12.76 billion previously.
KLK declared an interim single tier dividend of 20 sen per share, to be paid on July 30.
Overall, the group expects its overall financial performance for FY24 to be impacted by the manufacturing segment and Synthomer losses, partly bolstered by the strong contributions from the plantation segment.
KLK executive chairman Tan Sri Lee Oi Hian said the group will maintain its ongoing policies to enhance yields, reduce costs, and improve productivity amid global uncertainties and challenges.
"We remain cautious and vigilant, leveraging on our strengths to navigate persistent industry and global headwinds," he noted.
