KUALA LUMPUR (Nov 29): Jaya Tiasa Holdings Bhd announced a 45.5% jump in its net profit for the first quarter ended Sept 30, 2017 (1QFY18) to RM28.8 million, from RM19.8 million registered a year ago, mainly on the back of higher profit margin of its oil palm division, besides cost-saving strategies.

Revenue was up 3.8% to RM255.74 million during the quarter under review, compared with RM246.34 million in 1QFY17.

In its filing with the stock exchange this evening, Jaya Tiasa said higher profit margin in its oil palm division was achieved as a result of a 7% increase in crude palm oil (CPO) average selling price, coupled with the improvement in its oil extraction rate (OER), and capacity utilisation rate in its mills.

The group said its newly-completed CPO mill, which is strategically located within the oil palm estate, has helped with cost savings in transporting and distributing its fresh fruit bunches (FFB).

The oil palm and timber producer attributed the betterment in its revenue to its oil palm division, citing its CPO and palm kernel (PK) sales volume have “increased dramatically” by 26% and 31% respectively.

Looking forward, Jaya Tiasa is expecting a quarter-on-quarter improvement in FFB yield, as more estates are entering prime age.

The group also foresees improvement in the OER, with the implementation of stringent controls over the mills’ operational efficiency and FFB input quality.

“Notwithstanding our endeavour to enhance yield and productivity from the oil palm operations, the group’s financial performance is also dependent on the movement of CPO prices and the weather condition in the coming quarters,” the filing added.

Shares in Jaya Tiasa closed unchanged today at RM1.11, for a market capitalisation of RM1.08 billion. Year to date, the counter has lost about 17%.