KLK quarterly earnings rise 32% to RM154mil

The Star

22-05-2025

The group expects plantation earnings to remain resilient.
PETALING JAYA: Kuala Lumpur Kepong Bhd (KLK) posted a 31.8% year-on-year (y-o-y) rise in net profit to RM154.27mil for the second quarter ended March 31, 2025 (2Q25), driven by higher crude palm oil (CPO) and palm kernel (PK) selling prices, which bolstered plantation earnings despite a weak showing in its manufacturing segment.
Revenue for the quarter grew 16.2% y-o-y to RM6.34bil, as CPO prices averaged RM4,116 per tonne, up 13.7% from RM3,620 a year ago, while PK surged 70.2% to RM3,265 per tonne.
For the first half of its financial year 2025 (1H25), KLK's net profit rose 8.9% y-o-y to RM374.73mil on the back of a 10.7% increase in revenue to RM12.28bil.
The group declared a 20 sen interim dividend to be paid on July 29, with the entitlement date set for July 10.
The plantation segment remained the primary profit driver, with 2Q25 profit improving to RM454.3mil from RM357.7mil a year earlier, helped by favourable selling prices.
Furthermore, this was despite lower CPO and PK sales volumes and a fair value loss of RM53.4mil on unharvested fresh fruit bunches.
However, the manufacturing division turned in a pre-tax loss of RM38.3mil versus a RM56.7mil profit in 2Q24, weighed by continued losses in its refinery and kernel crushing operations.
KLK's performance was also impacted by a RM63mil share of loss from 27%-owned Synthomer plc and foreign exchange losses totalling RM217mil in 1H25, both of which are non-cash in nature.
The group expects plantation earnings to remain resilient, supported by the upcoming high crop season and cost management amid expectations that CPO prices will trade between RM3,800 and RM4,200 per tonne.
'Given the challenging macroeconomic outlook and increased volatility in commodity markets following recent tariff developments, the group adopts a prudent stance in navigating the remainder of financial year 2025,' it noted.
Meanwhile, KLK's major shareholder Batu Kawan Bhd saw its net profit rise 3.7% y-o-y to RM87.89mil in 2Q25, while revenue climbed 15% to RM6.51bil.
For the first half, net profit rose 9.7% to RM215.48mil, while revenue increased 9.9% to RM12.63bil.
Additionally, Batu Kawan's plantation segment delivered a 41% jump in profit to RM1.05bil in 1H25, underpinned by stronger CPO and PK prices, which helped offset lower fresh fruit bunch yields and extraction rates caused by adverse weather conditions.