KUALA LUMPUR (May 30): Yee Lee Corp Bhd saw its net profit sink 46% to RM6.2 million in its first quarter ended March 31, 2017 (1QFY17), from RM11.53 million a year ago, despite higher revenue, as earnings fell across all its divisions, including contribution from Spritzer Bhd, in which it has a 32.07% stake.

Quarterly revenue was up 6% year-on-year at RM267.88 million, from RM252.43 million, its Bursa Malaysia filing today showed.

The manufacturing division's profit before tax (PBT) fell 33% to RM4.2 million, despite higher revenue, as it was impacted by losses incurred by its mill due to lower fresh fruit bunches (FFB) processed, and lower oil extraction rate (OER) and palm kernel recovery rate.

Its trading division PBT fell 63% to RM2.54 million in 1QFY17, largely due to a substantial drop in sales of beverages and higher advertisement and promotion expenses. 

“The higher selling price of palm-based products has offset the substantial drop in sales of beverages, especially the bottled water and energy drinks,” the group said. 

Meanwhile, its plantation division saw a narrower loss before tax of RM280,000, compared with RM370,000 a year ago, as tea sales rose, although its oil palm plantation continued to be affected by lower FFB production due to a replanting programme.

Going forward, Yee Lee said it foresees another challenging year, with uncertainties and adverse market conditions surrounding the global economy.

In light of weak domestic consumer sentiment and rising inflationary pressure, it would continue to execute more marketing campaigns and increase variety to spur sales growth.

Separately, it said it plans to turnaround its mill by continuing to focus on tightening FFB quality inspection and production efficiency, while further adjusting its FFB price reduction scheme to commensurate with industry OER.

Shares in Yee Lee slipped 3 sen or 1.09% to RM2.71 today, leaving it with a market value of RM515.9 million.