KUALA LUMPUR (May 24): Batu Kawan Bhd’s net profit for the second quarter ended March 31, 2022 (2QFY22) rose 21.24% to RM316.54 million from RM261.08 million a year ago, on the back of its plantation and manufacturing segments strong showings.

Earnings per share leapt to 80.29 sen from 65.82 sen, according to the group’s filing on Tuesday (May 24). Revenue jumped 40.81% to RM6.65 billion from RM4.73 billion, as its plantation and manufacturing segments’ revenue contributions improved 87.83% and 35.24% respectively.

The group declared an interim dividend of 20 sen per share with an ex-date of July 8, 2022, and is to be paid on Aug 4.

Its plantation segment posted a revenue of RM1.05 billion in the quarter under review, as compared to RM559.7 million in 2QFY21, carried by higher crude palm oil (CPO) and palm kernel (PK) prices.

Meanwhile, its manufacturing segment logged a revenue of RM5.53 billion versus the RM4.09 billion a year ago, underpinned by higher contribution from its oleochemical division, and its refineries and kernel crushing operations. The segment's contribution was also boosted by a lower unrealised loss of RM39.48 million — as compared to RM43.12 million in 2QFY21 —from fair value changes on outstanding derivative contracts.

For the six months ended March 31 (6MFY22), Batu Kawan's net profit rose 43% to RM647.27 million from RM452.43 million, as revenue climbed 50.14% to RM13.76 billion from RM9.16 billion, again thanks to improved contributions from both its plantation and manufacturing businesses.

In terms of prospects, Batu Kawan noted that the current high palm oil prices augur well for its plantation segment, and are expected to be maintained in the near term, in view of the tight edible oils markets and supply disruption compounded by the Russia-Ukraine conflict.

“For the group’s manufacturing segment, the oleochemical division expects to perform satisfactorily for FY22, supported by current robust demand, despite challenges from an increase in raw material prices and energy costs, and shipping logistic issues.

As such, the group said its financial performance is expected to be strong for FY22.

Shares in Batu Kawan finished down 20 sen or 0.72% at RM27.50 on Tuesday, giving the group a market capitalisation of RM10.99 billion.