Thursday, November 17, 2011

TSH Resources 3Q net profit surges 89% to RM34.47m

KUALA LUMPUR (Nov 17): TSH RESOURCES BHD [] net profit for the third quarter ended Sept 30, 2011 surged 89% to RM34.47 million from RM18.24 million a year earlier, due mainly to the performance of its palm and bio-integration segment.

The company said on Thursday, Nov 17 that its revenue for the quarter rose to RM273.15 million from RM214.26 million in 2010.

Earnings per share rose to 8.41 sen from 4.45 sen in 2010, while net assets per share was RM2.06.

For the nine months ended Sept 30, TSH's net profit jumped to RM94.39 million from RM40.83 million in 2010 on the back of an increase in revenue to RM855.69 million from RM662.22 million in 2010.

Reviewing its performance, TSH said its palm and bio-bntegration business segment continued to yield good results due to higher crop production arising mainly from higher yield and increase in mature PLANTATION [] field in Indonesia.

The good performance was also partly attributed to mill operation which continued to show high efficiency, hence able to generate a higher oil extraction rate, it said.

The company said its cocoa manufacturing segment reported a lower profit due to lower production and unfavourable cocoa butter price.

As for the wood products segment, TSH said the increased loss was attributable to the decline in sale volume and gross margin and downsizing of overseas operations.

Commenting on its prospects, TSH said the subdued consumer sentiments and spending trends in Europe would restrain recovery of export market of Wood Products segment.

The company said it was now exploring opportunity in South Asia Region and aimed to win more local installation projects to turnaround the Wood segment.

TSH said with the high Indonesia bean price due to export tax and increase in grinding of bean in Indonesia, the cocoa manufacturing segment faced a very competitive business conditions.

Combined with the low cocoa butter ratio and lower selling price, the cocoa manufacturing segment's performance in the coming months will continue to be challenged by the volatile demand and supply of its finished products in the global market, it said.

In the palm and bio-integration business segment, TSH said palm oil prices were stabilising at around 2,900 to RM3,000.

'Despite macroeconomic development in Europe and USA which may limit the upside of the CPO prices, the fundamental demand for this crop remains strong due to its inherent competitiveness.

'Given the aforesaid situation, with the palm oil prices maintaining at current level and with increased hectarage coming into maturity, the group is expected to achieve a satisfactory level of profitability,' it said.


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