PETALING JAYA: PPB Group Bhd’s net profit fell by almost a quarter in the first quarter ended March 31, following the RM138mil losses recorded in its grains and agribusiness segment.

       The diversified conglomerate said its net profit dropped to RM303.16mil, as compared to RM402.18mil in the previous corresponding quarter.

       This was despite the higher contribution from its associate company Wilmar International Ltd by 14% to RM394mil.

       PPB’s revenue, on the other hand, improved by 23.61% year-on-year (y-o-y) to RM1.38bil from RM1.12bil a year earlier.

       “All key segments contributed positively to the increase in group revenue,” it said in a filing with Bursa Malaysia.

       On the losses made by the grains and agribusiness segment, the group explained that it was mainly attributable to fair value losses on derivatives instruments for hedging purposes as well as increase in raw material costs.

       Earnings per share in the first quarter under review were 21.31 sen. The group did not declare a dividend for the quarter.

       PPB expects its grains and agribusiness segment to experience further profit margin erosion, as food commodity prices and operating costs are expected to stay high as a result of the challenging global macroeconomic conditions and ongoing Russian-Ukraine conflict.

       “The segment is making every effort to mitigate such losses through alternative origins of grain sourcing and leveraging on our technical expertise in formulations and product performance, nonetheless price increase of our core products would be inevitable to address the impact of cost escalation.”

       As for the consumer products segment, PPB said it will continue to face high product and labour costs.

       Nevertheless, the segment is expected to perform satisfactorily with the increase in consumer demand as the country enters the endemic phase.

       “The film exhibition and distribution segment started the year on a stronger footing with cinema admissions improving significantly y-o-y.

       “The continued easing of Covid-19 standard operating procedures, coupled with a strong movie line-up for the summer releases, are expected to contribute positively to the segment going into the second half of the year.

       “The management will remain focused in driving operational cost efficiency and revenue diversification,” it said.

       On the property segment, the group said the performance would likely improve, with a gradual recovery in its mall operations.

       “The environmental engineering and utilities segment will continue to focus on replenishing its order book and exploring new project opportunities

       “Wilmar’s performance will continue to contribute substantially to the overall profitability of the group,” it added.