KUALA LUMPUR (June 29): Kim Loong Resources Bhd's net profit almost doubled to RM24.3 million for the first quarter ended April 30, 2017 (1QFY18) from RM12.4 million a year earlier, on higher contribution from its plantation operations.

Revenue climbed 44% to RM255.7 million from RM177.7 million in 1QFY17, Kim Loong said in a filing with Bursa Malaysia today, adding that earnings per share rose to 7.81 sen from 3.99 sen.

The group's plantation operations saw revenue jump 97% during the quarter while profit shot up 295% to RM34.3 million due to increased fresh fruit bunches (FFB) production and price.

FFB production rose 68% to 88,300 tonnes from 52,500 tonnes in 1QFY17 because of substantial contribution by its Keningau estates in Sabah which showed a 90% increase.

Kim Loong added that it did not face difficulty selling its FFB production as most of the produce was supplied to its mills, while the average FFB price was about 17% higher.

As for its palm oil milling operations, profit fell 23% to RM6.3 million due to lower oil extraction rate and stiff competition for crops that resulted in a margin squeeze despite processing higher quantities.

Moving forward, Kim Loong foresees an increase in FFB production from young mature areas and strong FFB yield recovery in Keningau, where some 50% of its planted mature area is located.

It expects its FFB production for FY18 to be 20% higher compared with FY17.

As for crude palm oil (CPO) production, Kim Loong said despite stiff competition from surrounding mills, it aims to achieve FFB intake of 1.2 million tonnes, up from 1.15 million tonnes in FY17.

"Subject to the ringgit fluctuation and volatility of the commodity market, we expect the prospect of CPO price to be positive and good. We expect the group's performance for FY18 to be satisfactory," it added.

Kim Loong's share price closed up two sen or 0.53% at RM3.82, for a market capitalisation of RM1.2 billion.