The firm had provided impairments over RM160m for its heavy industries and property divisions
by FARA AISYAH / pic by TMR
BOUSTEAD Holdings Bhd slipped into the red as impairments totalling RM161.3 million dragged the conglomerate into a RM155 million net loss for the third quarter ended Sept 30, 2019 (3Q19).
The company had provided impairments over RM160 million for its heavy industries and property divisions.
During the same quarter last year, the group, almost 60%-owned by Lembaga Tabung Angkatan Tentera (LTAT), registered a RM7.3 million net profit. It also posted a loss per share of 7.65 sen in the three months, compared to earnings per share of 0.36 sen in 3Q18.
Boustead’s quarterly revenue, however, increased 5% year-on-year (YoY) to RM2.73 billion from RM2.6 billion in 3Q18.
For the nine-month period (9M19), Boustead’s net loss widened to RM153.1 million from RM14.2 million last year. Besides impairments, the group incurred higher finance cost and operating losses recorded by its plantation and heavy industries divisions.
The group’s revenue in 9M19 increased 6.28% YoY to RM7.79 billion from RM7.33 billion in the same period last year due to higher contributions from most of its business segments.
“Despite headwinds, the group recorded solid revenue growth for the 9M19,” Boustead MD Datuk Seri Amrin Awaluddin (picture) said in a statement last week.
“However, due to the one-off impairments in the property and heavy industries divisions, our bottom line was impacted,” he added.
Revenues from the pharmaceutical division in January to September 2019 improved to RM2.1 billion from RM1.8 billion in 9M18 due to solid contributions from both the concession and non-concession businesses.
The property division’s revenue increased by 9% to RM400.5 million in 9M19, largely due to higher progress of works for development activity at Taman Mutiara Rini, Johor, and One Cochrane Residences, Kuala Lumpur.
Boustead’s finance and investment division also posted higher revenue of RM154.5 million in 9M19, reflecting a 5% increase, mainly due to higher tuition fees from the University of Nottingham Malaysia Campus.
However, the trading and industrial, as well as plantation divisions registered lower revenues of RM3.8 billion (RM4 billion in 9M18) and RM398.1 million (RM427.4 million in 9M18) respectively, mainly due to lower commodities prices.
“As we strive to achieve a turnaround for the group, we are cognisant of the challenges we face in the current operating environment.
“We remain focused on enhancing efficiencies and extracting further value within the respective operating units, with a view to deliver sustainable earnings over the long term,” Amrin said.
Meanwhile, Boustead Plantations Bhd has appointed a new CEO Ibrahim Abdul Majid effective Dec 1, 2019.
Boustead Plantations also announced the promotion of Mohamad Mahazir Mustaffa as its new CFO and the appointment of Noral Afida Alwi as its new financial controller.
Boustead closed one sen or 0.52% higher to 97 sen last week, giving it a RM1.96 billion market capitalisation.