Guan Chong Bhd's [KL:GCB] net profit for the first quarter ended March 31, 2024 (1QFY2024) jumped almost four-fold year-on-year to RM92.04 million, from RM23.76 million or 2.02 sen per share in 1QFY2023 on higher selling price for cocoa butter and increased sales volume for cocoa solids.

KUALA LUMPUR (May 27): Guan Chong Bhd [KL:GCB], the world’s fourth-largest cocoa grinder, announced that net profit for the first quarter ended March 31, 2024 (1QFY2024) jumped almost four-fold year-on-year, thanks to higher selling price for cocoa butter and increased sales volume for cocoa solids.

Net profit for 1QFY2024 climbed to RM92.04 million or 7.83 sen per share from RM23.76 million or 2.02 sen per share in 1QFY2023, Guan Chong’s bourse filing showed.

Revenue grew by nearly 70% to RM1.87 billion for 1QFY2024, from RM1.1 billion a year ago. No dividend was declared for the quarter under reviewed.

Moving ahead, Guan Chong aims to enhance existing grinding facilities in Malaysia, Indonesia, and the Ivory Coast, as well as develop value-added capacities in the UK and the US by allocating over RM50 million for these expansions.

By the end of 2024, it intends to increase its annual cocoa ingredient capacity to 360,000 tonnes, up from 330,000 tonnes as of Dec 31, 2023.

Brandon Tay Hoe Lian, the managing director and chief executive officer of Guan Chong, said it remains optimistic about the rising consumption of chocolate, following the increasing tourism and festive activities, which bodes well for the group.

Still, he flagged the challenges posed by escalating cocoa bean prices and supply shortages, but will proactively manage its working capital needs and maintain close communication with supporting banks to ensure smooth operations.

The company added that it will continue to focus on its core business of cocoa ingredient processing while also expanding into the higher-margin industrial chocolate market and optimising production in accordance with market conditions.

At the market close on Monday, Guan Chong's shares settled at eight sen or 2.03% lower to RM3.86 after 8.22 million shares were traded, valuing the company at RM4.53 billion.