Thursday 28 Mar 2024
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This article first appeared in The Edge Financial Daily, on June 29, 2016.

 

KUALA LUMPUR: Subur Tiasa Holdings Bhd registered a net loss of RM13.9 million in the third quarter ended April 30, 2016 (3QFY16) compared to a net profit of RM2.71 million in the corresponding quarter a year ago.

According to its bourse filing yesterday, the decline in earnings was mainly due to lower average free on board export selling prices of logs, plywood and sawn timber; higher raw material costs for manufacturing of timber products; and higher volume of fertiliser applied to higher acreage of mature oil palm trees.

The group’s revenue for 3QFY16 decreased 37.6% to RM110.2 million from RM176.7 million.

For its cumulative nine-month period ended April 30, 2016 (9MFY16), it recorded a net loss of RM15.6 million compared to the net profit of RM5.96 million in 9MFY15.

The loss was mainly due to a decrease in export sales volume for logs and timber products, an increase in raw material costs for timber products, and a higher overhead unit cost for logging operation and manufacturing of timber products.

On prospects, it said: “The slowdown in global economy is expected to continue in year 2016. This together with current low commodity prices will have negative impact on the global outlook.”

However, it noted that log prices are expected to be favourable in view of prevailing tight supply of logs and the strong US dollar against the ringgit.

It also said the upcoming peak crop season will see an increase in fresh fruit bunch production in Subur Tiasa’s oil palm plantation.

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