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BSTEAD 2771 BOUSTEAD HOLDINGS BERHAD’s 1Q22 net profits jump five-fold, boosted by one-off land disposal


KUALA LUMPUR (May 27): Boustead Holdings Bhd saw its net profits for the first quarter ended March 31, 2022 (1QFY22) soar 574% year-on-year (y-o-y) to RM290.3 million, boosted by a one-off gain from the disposal of plantation land of RM364.1 million.

Though its profitability was boosted by the gain on the disposal of the plantation land, all other divisions except for property and industrial division delivered stronger performance during the quarter compared with the corresponding quarter.

This can be seen from the 65% jump in the group’s revenue y-o-y during the quarter under review to RM3.44 billion. The property and industrial division, trading, finance and investment division, plantation division and the pharmaceutical division contributed higher revenue to the group overall.

The property and industrial division registered RM323.8 million revenue, which was more than double from a year ago. The plantation division’s revenue was boosted by higher average selling price of crude palm oil and palm kernel, coming in at RM324.2 million, which was 89% higher y-o-y.

Its pharmaceutical division achieved RM962.2 million revenue in 1QFY22 compared with RM739.5 million in 1QFY21, while revenue at the trading, finance and investment division was 92% higher compared with 1QFY21 at RM1.7 billion.

However, profit before tax (PBT) of the property and industrial division was 38.3% lower y-o-y at RM38.9 million, as the division had benefited from a one-off gain on disposal of a hotel at RM77.1 million in 1QFY21.

“At the operational level, in 1QFY22, the property development and hotel segments recorded better contribution mainly due to the sale of industrial land in Bukit Raja, Klang and improved room revenues from better occupancy rate.

“Meanwhile, the property investment segment posted higher losses due to higher share of loss from a joint venture and lower rental rate for our shopping mall,” said Boustead in the financial statement.

Despite the one-off gain on disposal of plantation land that boosted the plantation division’s PBT during the quarter under review, operation-wise, the division registered higher profits of RM151.2 million compared with RM33.4 million in 1QFY21 due to higher palm product prices and fresh fruit bunch production.

The pharmaceutical division recorded a higher PBT of RM36.9 million (1QFY21: PBT of RM30 million) mainly driven by higher revenue, said Boustead.

Meanwhile, PBT for the trading, finance and investment division more than doubled to RM122.1 million in 1QFY22 from RM47.3 million in 1QFY21, mainly driven by a higher stockholding gain by Boustead Petroleum Marketing on the back of higher average fuel prices.

“The bottom line has also benefited from the better contribution by our associate Affin Bank Bhd, attributable to improved net interest income, Islamic Banking income, net fee and commission income and allowance for impairment losses,” the group said.

Boustead closed at 76 sen per share on Friday (May 27), valuing the group at RM1.54 billion. Over the last year, the counter has appreciated by 29.9%, and is currently trading at 3.69 times its trailing four quarter earnings per share.

http://www.theedgemarkets.com/article/bousteads-1q22-net-profits-jump-fivefold-boosted-oneoff-land-disposal

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