KUALA LUMPUR (May 24): Weaker prices for palm oil products led to a 62.46% decline in TA Ann Holdings Bhd’s first quarter net profit to RM39.27 million from RM104.62 million a year earlier.

Earnings per share for the quarter ended March 31, 2023 (1QFY2023) fell to 8.92 sen from 23.75 sen previously, according to the group's stock exchange filing.

“The main contributing factors to the variation of performance were the (drop in) crude palm oil (CPO) and fresh fruit bunches average selling prices by 33% and 41% respectively which had resulted in lower revenue and profit,” the group said.

The lower profitability was also due to lower gains recognised in the fair value of the biological assets, amounting to RM700,000, compared with RM25.53 million previously.

Quarterly revenue dropped 28.11% to RM350.65 million from RM487.75 million in 1QFY2022.

Despite the weaker quarterly performance, TA Ann has declared a first interim dividend of 10 sen per share, unchanged from last year, payable on July 7.

Going forward, the group expects CPO prices to remain firm over a longer term. It also hopes to benefit from the current lower fertiliser prices as manuring activities are ramping up.

Meanwhile, TA Ann also expects the timber price trend to remain stable given that the demand for both tropical logs and plywood is expected to be greater than the market supply.

Shares in TA Ann closed unchanged at RM3.22 on Wednesday (May 24), giving the group a market capitalisation of RM1.43 billion.