KUALA LUMPUR (Sept 23): United Malacca Bhd posted a more than five-fold jump in net profit to RM20.85 million for the first quarter ended July 31, 2021, from RM3.55 million a year earlier, as higher crude palm oil (CPO) and palm kernel prices saw its Indonesian operations break even while Malaysian operations showed growth.

Earnings per share rose to 9.94 sen from 1.69 sen, the group’s stock exchange filing showed.

United Malacca saw higher production from its Indonesian operations, while Malaysian operations’ production fell.

During the quarter, the group saw average CPO price increase by 45% and 62% year-on-year in Indonesia and Malaysia respectively, while palm kernel average price rose over 90% in both markets.

This supported quarterly revenue, which rose 32.36% to RM114.87 million from RM86.79 million a year earlier.

On prospects, United Malacca sees higher fresh fruit bunches (FFB) production on higher yields, better age profile and an increase in mature area in its Kalimantan estates.

“However, the group remains cautious in view of the volatility of CPO prices, increasing fertiliser costs and shortage of labour for Malaysian operations as a consequence of the restriction of foreign labour recruitment,” it said.

All Malaysian employees are expected to be fully vaccinated in September, it said, while it will also expedite the process in Indonesia.

“Management's priority remains focused on improving labour productivity, mechanisation initiatives and cost efficiency as well as increasing FFB yield,” it said.

Shares of United Malacca fell 2 sen or 0.4% in thin trade to RM5.02, valuing the plantation group at RM1.05 billion.