PPB Group net profit down 53% in third quarter

PETALING JAYA: PPB Group Bhd suffered a 53% drop in net profit after almost all segments posted reduced earnings in the third quarter ended Sept 30, 2023 (3Q23).

The conglomerate, controlled by Malaysia’s richest man Robert Kuok, however expects its biggest revenue contributor – the grain and agribusiness segment – to continue performing well in the last three months of the year.

Its consumer product segment is foreseen to perform satisfactorily while the property segment, which is planning for new launches, is likely to see modest revenue from the sales of remaining completed units.

“At this transition period, we will continue with our efforts to improve the occupancy and footfalls of our malls,” PPB said in a filing with Bursa Malaysia.

As for the film exhibition and distribution segment – the Golden Screen Cinemas Sdn Bhd theatre chain – the group noted that the recent strikes by Hollywood actors and writers had led to the deferment of several key blockbuster titles.

This will affect the admissions and box office collections in the final quarter.

“Management is re-prioritising several of its initiatives and optimising costs to navigate the challenges faced by the cinema industry,” it said.

In 3Q23, PPB reported a net profit of RM372.55mil, which declined by 52.53% year-on-year (y-o-y) and brought earnings per share down to 26.19 sen. Revenue fell by 11.63% y-o-y to RM1.46bil.

PPB’s reduced profits for the period was mainly attributable to the lower contribution from its 18%-owned associate Wilmar International Ltd, down by 63% y-o-y to RM268mil.

No dividend was declared for the quarter under review.

In the nine-month period (9M23), PPB’s net profit fell by 46.5% y-o-y to RM952.91mil while revenue declined marginally by 1.8% y-o-y to RM4.46bil.

The grains and agribusiness segment posted a revenue of RM3.32bil and a higher profit of RM223mil in 9M23.

Consumer product revenue was at RM576mil, with a lower profit of RM19mil, attributable mainly to higher operating costs.

The film exhibition and distribution segment’s revenue and profit were higher at RM463mil and RM19mil, respectively, on the back of a 23% and 25% increase in the Malaysian box office collections and admissions, respectively.

“The better performance of the Vietnam operation further contributed to the improved profitability of the segment,” stated PPB.