KUALA LUMPUR: Sarawak Plantation Bhd shares rose at the mid-morning session after it posted a higher first quarter ended March 31, 2026 (1Q 2026).
At 11:01 am, Sarawak Plantation shares gained six sen to RM3.75 with 128,600 shares traded.
In a Bursa Malaysia filing on Wednesday, the company said its net profit rose to RM23.09 million in 1Q 2026 from RM22.63 million a year ago, in line with a fall in operating profit.
Revenue, however, declined to RM105.18 million from RM135.50 million previously.
“During the quarter, estate operations recorded a segment revenue and segment profit of RM60.3 million and RM20.8 million, respectively, whereas mill operations recorded a segment revenue and segment profit of RM93.5 million and RM5.1 million, respectively,” it said.
Sarawak Plantation said the oil palm operations segment contributed 99.8 per cent of the group’s revenue of RM105.18 million.
“Revenue from oil palm operations decreased by RM30.2 million to RM104.9 million in 1Q 2026, versus RM135.1 million a year ago.
“The decrease was principally attributable to the lower sales volume of crude palm oil (CPO) by 14.3 per cent, coupled with lower realised average selling prices of CPO and palm kernel (PK) by 14.7 per cent and 8.6 per cent, respectively, despite higher sales volume of PK by 7.4 per cent during the quarter,” it added.
Despite global economic uncertainties, CPO prices had exhibited an upward trend. Hence, the price outlook is optimistic, driven by increasing demand for biofuel.
“The group remains committed to prudent financial management and operational efficiencies through prioritisation of cost management initiatives to manage anticipated escalating costs and associated business risks, coupled with continuous improvement of production and productivity.
“Barring any unforeseen circumstances and subject to a sustainable CPO price, the group anticipates delivering satisfactory financial results for the current financial year,” it said.
In a research note today, Apex Securities Bhd is optimistic about the group’s performance for the remainder of the year due to higher expected CPO prices and improving seasonal fresh fruit bunches (FFB) production.
“We believe that external FFB purchases will normalise as the group is in talks with new potential FFB suppliers and is expecting new supplies to be obtained.
“This should be supported by recovering industry yields as the year progresses into a more favourable production season,” it said
However, it said only about 60 per cent of fertiliser supply for FY2026 has been secured at pre-war prices.
“We believe that higher average selling prices will offset increases in costs,” it added.
Apex Securities has revised its CPO price higher to RM 4,400 per tonne from RM 4,200 while raising its in-house FFB production assumptions slightly to account for better-than expected year-to-date numbers.
“Consequently, we have revised earnings higher by four per cent/nine per cent for FY2026/2027. Our forecasts also take into account a possible increase in fertiliser prices as we move into FY2027,” it said.
It is upgrading its call on Sarawak Plantation to a ‘Buy’ with a higher target price of RM3.89 per share. – BERNAMA
