MKH Oil Palm posts RM39.94 mln 1Q profit, riding on strong CPO prices, higher sales
KUCHING (Feb 28): MKH Oil Palm (East Kalimantan) Berhad (MKH Oil Palm) an upstream oil palm plantation company based in East Kalimantan, reported a net profit of RM39.94 million on revenue of RM102.65 million for its first quarter ended December 31, 2024.
The strong first-quarter performance accounted for 62.2 per cent of MKHOP’s full-year results for the financial year ended Sept 30, 2024 (FY24), during which the company posted a net profit of RM64.21 million.
No comparative figures were available on a quarterly basis, as MKHOP was only listed on the Main Market of Bursa Malaysia Securities Berhad on April 30, 2024.
The solid results were driven by higher crude palm oil (CPO) and palm kernel (PK) selling prices, which have been steadily rising, alongside increased sales volume compared to the preceding quarter.
“The company also proactively undertakes efficiency measures throughout its plantations and supply chain,” it said in a statement on Thursday.
For the first quarter, MKHOP’s average CPO price, net of Indonesia’s export duty and levy, stood at RM3,848 per metric tonne (MT), while PK was priced at RM2,659 per MT.
The company recorded fresh fruit bunch (FFB) production of 113,377 MT during this period.
MKHOP currently has a total land area of 18,205 hectares, with 17,009 hectares planted and matured. The company also maintains a strong financial position with negligible borrowings, while its cash reserves increased to RM236.15 million from RM225.22 million in the previous quarter.
Meanwhile, MKHOP is conducting due diligence for its planned land acquisitions, with relevant announcements to be made in stages.
Industry-wide, palm oil prices are expected to remain high, supported by strong demand for biodiesel production.
Indonesia’s biodiesel blend rate has increased from 35 per cent (B35) in 2024 to 40 per cent (B40), an initiative expected to absorb an additional 1.2 to 1.7 million MT of CPO and further support higher prices.
MKHOP chairman Tan Sri Alex Chen Kooi Chiew expressed confidence in the company’s prospects given the favourable market conditions.
“The group’s outlook for the financial year ending Sept 30, 2025, remains strong, with CPO trading at approximately RM3,800 to RM4,000 per MT (net of export levy and duty) in Indonesia.
“There has been ongoing strong demand for palm oil supported by Indonesia’s strong biodiesel mandate, and tighter global supply.
“Also, the Group had continuously undertaken proactive measures to strengthen our competitiveness; including enhancing our water management system, fine-tuning our harvesting Standard Operating Procedures, among others,” he said.
-Agency
