KUALA LUMPUR (Nov 14): Plantation player Kuala Lumpur Kepong Bhd, on announcing that net profit for the fourth quarter of its financial year 2018 (4QFY18) has slumped 58.1% year-on-year on weaker crude palm oil and palm kernel prices, warned that its performance in the first half of FY19 will continue to be affected by prevailing depressed palm product prices.

Its net profit for 4QFY18 ended Sept 30, 2018, fell to RM101.5 million from RM242.12 million, pulling earnings per share down to 9.5 sen from 22.7 sen.

Revenue shrank 18.8% to RM4.19 billion from RM5.16 billion a year ago as contribution from its plantations and manufacturing divisions fell, although this was partly offset by an improvement in revenue from the group’s property development segment.

Average CPO ex-mill price per tonne was 19.4% lower than a year ago at RM2,060, while average PK ex-mill price per tonne was down 26.3% at RM1,594, KLK noted in its stock exchange filing today.

For the full FY18, KLK recorded a 25.1% drop in net profit to RM753.33 million from RM1.01 billion in FY17, as revenue retreated 12.4% to RM18.4 billion from RM21 billion.

On current year prospects, KLK said current high CPO inventory level has negatively impacted palm product prices. "Whilst we expect FFB (fresh fruit bunch) production to improve, the current uncertainty in palm product prices will pose a challenge to our plantation profit for financial year 2019," it said.

Meanwhile, its oleochemical division is expected to maintain its performance with higher capacity utilisations and operational efficiencies.

Shares in the group rose two sen or 0.08% to close at RM24.92 today, giving the group a market capitalisation of RM26.54 billion.