KUALA LUMPUR: Plantation conglomerate Sime Darby on Friday said its net profit rose 37% to 443 million ringgit ($99 million) in the quarter ended Sept. 30, thanks to foreign exchange gains and asset disposals.
Revenue grew marginally to 10.1 billion ringgit in the quarter, the first of the company’s fiscal year. The group, which has operations in 25 countries, noted that the improved earnings did not come easily.
“The results are a reflection of the operating environment today, which is uncertain on many fronts,” Mohd Bakke Salleh, Sime Darby’s president and group chief executive, said in a press release. “Politically and economically, we are experiencing uncertainties and ambiguity in just about every sector.”
Revenue at its plantation division dropped 10% to 273 million ringgit, hit by lower palm yields due to the impact of El Nino weather conditions. Even so, this was offset by an exchange gain of 45 million ringgit and the sale of oleochemical assets for 21 million ringgit.
The industrial division, which sells heavy machinery used in mining operations, posted revenue of 51 million ringgit, down from 63 million ringgit for the same period last year. The decline was pinned on weakening markets in Malaysia, Singapore and China.
Increased luxury vehicle sales in China, Hong Kong, Singapore and Vietnam pushed the motors division’s revenue up by 53%. The property segment also performed 69% better, thanks to asset disposals in Singapore and Malaysia.
Though average crude palm oil prices recovered to 2,592 ringgit per metric ton during the quarter, from 2,088 ringgit in the previous term, the group said market volatility will remain a challenge.
Sime Darby’s shares inched up 0.75% to 8.1 ringgit, while the benchmark FTSE Bursa Malaysia KLCI rose 0.19% to 1,627.26 on Friday.
