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Outstanding 1HFY25 figures for TSH Resources
TSH reported excellent CNP for its 1HFY25 which came up to 67 per cent of Kenanga Investment Bank Bhd (Kenanga Research) and 71 per cent of consensus full-year estimates.
KUCHING (August 21): Sabah-based TSH Resources Bhd (TSH) reported excellent core net profit (CNP) for its first half of its financial year 2025 (1HFY25) which came up to 67 per cent of Kenanga Investment Bank Bhd (Kenanga Research) and 71 per cent of consensus full-year estimates.
The planter's CNP for its second quarter (2Q) was five per cent easier quarter on quarter (q-o-q) but still up 207 per cent year on year (y-o-y).
Good crude palm oil (CPO) and palm kernel (PK) prices easily mitigated flattish fresh fruit bunch (FFB) harvest in 2Q.
Excluding currency gains (RM3.9 million), fair value loss (RM2.5 million) and asset impairments less some disposal gain (RM4.4 million), Kenanga Research said TSH's 1HFY25 core net profit (CNP) was RM100.3 million on better CPO and PK prices y-o-y while 1H FFB output held steady y-o-y.
'TSH's 2QFY25 reported a CNP of RM48.8 million as better FFB harvest and PK prices offset softer CPO prices. Hence, even though 2QFY25 revenue slipped, q-o-q it inched up y-o-y,' it said.
'2QFY25 margins also held well q-o-q and much stronger than 2Q of FY24 while 2QFY25 tax was lower on utilisation of tax losses.'
TSH ended 2QFY25 with stronger net cash of RM61 million (versus RM46 million in 1QFY25) but no interim dividend per share (DPS) was declared which is in line with its practice hence within Kenanga Research's expectation.
The research firm added its belief that global edible oil supply for 2025-2026 will stay tight, as 2025's edible oil supply tightness is already reflected in current firm CPO prices.
It saw that 2026 supply should improve by two to four per cent on stable to larger palm, soya and sunflower harvests compared to estimated supply growth of just one to two per cent in 2025.
'While supply is expected to improve in 2026, the increase can only match or, more likely, stay below trendline y-o-y demand growth of three to four per cent.
'Coupled with strong realised 1HFY25 prices for TSH of RM3,932 per metric tonne (MT), we are nudging up the group FY25 average CPO prices from RM3,700 to RM3,900 per MT but keeping FY26 at RM3,600.
'Meanwhile, cost should stay manageable on strong PK prices and flattish input costs.' economic news finance quarterly results TSH Resources Bhd
