KUALA LUMPUR (Feb 28): TH Plantations Bhd reported a 95% year-on-year net profit fall in its fourth quarter, as the previous corresonding period benefitted from an extraordinary gain of RM112.58 million from the disposal of shares in a subsidiary.

Net profit for the three months ended Dec 31, 2017 (4QFY17) came in at RM6.88 million against RM127.46 million a year ago. Quarterly revenue climbed 5% y-o-y to RM178.20 million from RM170.08 million, on higher sales of palm kernel (PK) and fresh fruit bunch (FFB).

Excluding the effect of the share disposal, the group’s operating profit grew 63% y-o-y to RM45.67 million from RM27.97 million, thanks to higher revenue and lower cost of sales.

TH Plantations proposed a final dividend of 2 sen per share, bringing its full-year dividend payout to 3.6 sen per share, versus FY16's 6 sen.

In a Bursa Malaysia filing today, it said its FFB production increased by 40% year-on-year during the quarter, while crude palm oil (CPO) production was up 4%, mitigating the 5% decline in the average CPO price for the period to RM2,634 per metric tonne.

It also revised its amortisation and depreciation rate, which resulted in lower cost of sales in 4QFY17, the filing added.

Meanwhile, average PK traded price fell 9% to RM2,499 per tonne, in line with the decline in palm oil product prices, as production and stockpiles recovered in the second half of 2017.

Due to the absence of the share sale gain, its FY17 annual net profit fell 75% y-o-y to RM36.73 million, from RM147.07 million. Revenue, however, grew 23% to RM689.22 million from RM562.31 million.

In terms of operating profit, the sum doubled to RM157.9 million from RM78.69 million.

“The outlook for 2018 is encouraging, as production is expected to fully recover this year. Prices, on the other hand, while they have moderated from recent year highs, have remained steady at current levels and are expected to remain range-bound this year.

“We expect another good year for the group and the industry, barring any unforeseen circumstances,” said TH Plantations' chief executive officer Datuk Seri Zainal Azwar Zainal Aminuddin in a statement.

TH Plantations closed unchanged at 98.5 sen today, giving it a market capitalisation of RM879.43 million.