Leong Hup 3Q net profit up 98%, declares 1.2 sen dividend

KUALA LUMPUR (Nov 28): Poultry, egg and livestock feed producer Leong Hup International Bhd saw its net profit for the third quarter ended Sept 30, 2023 (3QFY2023) rise 97.5% to RM132.96 million from RM67.31 million a year earlier, on better margin from higher selling prices of day-old-chicks (DOC) and eggs in Malaysia, and DOC in Indonesia.

As a result, earnings per share came in higher at 3.64 sen for 3QFY2023 compared with 1.84 sen for 3QFY2022.

Quarterly revenue also rose 6.6% to RM2.52 billion in 3QFY2023 from RM2.36 billion a year earlier, on higher selling price and sales volume of broiler chickens and higher selling price of DOC in Indonesia, higher selling price and sales volume of eggs and DOC in Malaysia, higher sales volume of dressed chickens in Philippines and higher sales volume of fresh chickens in Singapore.

The group declared an interim dividend of 1.2 sen per share amounting to RM43.8 million for the financial year ending Dec 31, 2023 (FY2023), payable on Jan 29, 2024.

The strong quarterly performance lifted Leong Hup's net profit for the cumulative nine months ended Sept 30, 2023 (9MFY2023) by 71.7% to RM220.14 million from RM128.19 million a year earlier, while revenue grew 6% to RM7.13 billion in 9MFY2023 from RM6.72 billion in 9MFY2022.

In a filing with Bursa Malaysia on Tuesday, Leong Hup said the strong regional economies provided a good backdrop for higher consumption of its products as the group continues to grow.

"The easing of feed input costs, particularly corn and soybean meal, provides relief to the industry. Barring unforeseen circumstances, the group expects the performance for FY2023 to be significantly better than prior year," it added.

In a separate statement, Leong Hup executive director and group chief executive officer Tan Sri Lau Tuang Nguang said: “The efforts to control costs and capital expenditure rationalisation over the past two years have provided the group with a strong base to propel the group further.”

Leong Hup shares closed down 0.5 sen or 0.72% to 69 sen on Tuesday, with 4.5 million shares traded. Its market capitalisation stood at RM2.52 billion.