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Tuesday, May 29, 2012

Boustead earnings rise 22% on higher revenue

PETALING JAYA: Boustead Holdings Bhd's net profit rose 22.4% to RM144.6mil for the first quarter ended March 31, from RM112.2mil a year earlier, on higher revenue.

The diversified conglomerate saw its revenue rise to RM2.4bil from RM1.6bil a year ago.

Boustead is involved in six key sectors of the economy, namely plantations, heavy industries, properties, finance and investment, trading, and manufacturing and services.

Earnings per share of the group improved to 13.98 sen for the first quarter compared with 10.85 sen a year earlier.

Boustead said all its business divisions recorded an increase in revenue during the quarter.

Its manufacturing and trading division saw higher sales volume, resulting in a 23% increase in revenue to RM1.26bil, while its pharmaceutical division's revenue rose sharply to RM446.7mil from RM28.7mil a year ago, reflecting the consolidation of Pharmaniaga Bhd.

Boustead's plantations division, however, saw only a marginal increase in revenue to RM263.8mil from RM254.4mil previously, as lower palm product prices trimmed the gains of a higher crop. Its cumulative fresh fruit bunches crop totalled 282,171 tonnes, up 11% from a year ago, but the average palm oil price was only RM3,143 per tonne, down RM398 or 11% from RM3,541 per tonne in the corresponding period last year.

For the first quarter, the plantation division contributed a slightly lower pre-tax profit of RM92.2mil, compared with RM99mil a year ago due to lower palm product prices.

Boustead's finance and investment division posted a cumulative pre-tax profit of RM26.1mil for the first quarter, up from RM11.9mil a year ago, largely on higher profit contribution from Affin Group.

Its property division also registered higher pre-tax profit of RM40.4mil compared with RM12.2mil a year ago. This was attributable to the gains from the sale of land.

The only division that saw a deficit was its heavy industries, with a pre-tax loss of RM5.4mil due to losses at the commercial shipbuilding segment and the fact that work on the second-generation patrol vessels have yet to move into full swing.

Given its overall positive results, Boustead declared an interim dividend of 7.5 sen for the first quarter, which was an improvement from eight sen a year ago.

For the coming quarters, Bousted expects its plantation division to perform well on positive outlook for crude palm oil prices. It also expects its pharmaceutical division to continue registering good growth.

As for its property division, Boustead said it expected the Surian Residences in Mutiara Damansara, which was already 98% sold and expected to be completed in mid-2013, to be the main revenue contributor for the division.

Its hotels and retail mall operations, on the other hand, are expected to perform satisfactorily.

Earnings at its trading and manufacturing division for the remainder of the year, Boustead said, would be driven by its BHPetrol operations.

By The Star

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