Boustead’s 3Q earnings boosted by strong performance from core divisions

by NUR HANANI AZMAN / pic by TMR

BOUSTEAD Holdings Bhd posted a net profit of RM55.7 million for the third quarter ended Sept 30, 2021 (3Q21), against a net loss of RM51.8 million in 3Q20 driven by better performance of its plantation, trading and investment, and pharmaceutical divisions. 

Its revenue for the quarter rose to RM3.68 billion from RM1.89 billion in 3Q20, a filing with the local bourse showed. Earnings per share for 3Q21 was 2.75 sen. 

In a statement yesterday, Boustead group MD Datuk Seri Mohammed Shazalli Ramly said the improved quarter performance is attributable to the strong focus on its core performance improvement programme upon the end of the nationwide lockdown and the acceleration of “Reinventing Boustead” strategies. 

He noted that these enable the group to deliver significant improvement to the overall performance of the business, despite the prolonged uncertainties in our economic outlook. 

“At this pivotal moment of the 3Q21 and anticipating the ensuing 4Q ahead of us, we are confident, strong-footed and galvanised than ever before to remain committed in our continuous explorations into driving synergies and improving performance across our core businesses, selective investments in digital technologies and transition into renewable energy to support the sustainability of our short to long term business plans. 

“The group’s vigilance and focus in unlocking value for the business remain firmly driven by our main vision of placing the interest of all our shareholders as the highest priority by maximising shareholder value, especially the Armed Forces Fund Board as our majority shareholder and enriching the lives of the Malaysian Armed Forces service members, veterans and their family members,” he said. 

For the cumulative nine-month period ended Sept 30, 2021 (9MFY21), Boustead’s net profit rose to RM91.5 million from a net loss of RM198.6 million for 9MFY20, as contributions from all segments improved. 

The group’s revenue for 9MFY21 rose to RM8.35 billion, up 48%, from RM5.65 billion recorded last year. 

Boustead’s bottom line was bolstered by one-off gains on disposal of the Royale Chulan Bukit Bintang hotel of RM84.6 million and an investment property of RM13.1 million. 

Boustead’s pharmaceutical division achieved a two-fold surge in revenue to RM4.1 billion from RM2.1 billion in 9MFY20 mainly due to strong demand from across the division’s concession, non-concession and Indonesian businesses, with sales of Sinovac vaccines to Health Ministry (MoH) and private sector a key driver. 

Boustead’s pharmaceutical interest via Pharmaniaga Bhd is currently involved in Sinovac’s global clinical trial for children aged three to 11, with interim efficacy results expected by early 2022. 

“As for the concession of logistics and distribution business, the division will continue to carry out its duties and responsibilities as MoH’s logistic partner until Nov 30, 2024. A series of discussions and negotiations for the renewal of the concession has been carried out and the outcome is very positive,” the release noted. 

The pharmaceutical division is also setting up an insulin manufacturing plant to meet the needs to treat non-communicable diseases, complementing the Division’s strong market presence in the cardiovascular and basic diabetic range, expected to be ready in 2025. 

Boustead’s heavy industries division will continue to explore (with Airbus Defence and Space) its plans to expand into rotary-wing and military fixed-wing maintenance, repair and overhaul, as well as into the commercial helicopter segment.