FINANCIAL HIGHLIGHTS OF YEAR2018
- PPB Group revenue rose 6% to RM4.53 billion in FY2018 mainly attributed to higher revenue generated from Grains and agribusiness; Environmental engineering and utilities; and Film exhibition and distribution.
- Group pre-tax profit of RM1.17 billion was 8% lower than FY2017 mainly due to lower profit contribution from our 18.5% associate, Wilmar International Limited (Wilmar) which contributed RM837 million for FY2018; profits from Grains and agribusiness and Consumer products segments were also lower.
- Profit for the FY2018 was RM1.1 billion and earnings per share was 75.57 sen.
A final dividend of 20 sen per share for FY2018 will be tabled for approval by PPB shareholders at the Annual General Meeting to be held on 17 May 2019. The final dividend is payable on 10 June 2019 to shareholders whose names appear in the Record of Depositors on 24 May 2019.
Together with the interim dividend of 8 sen per share, the total dividend paid and payable for FY2018 would be 28 sen per share (FY2017 : 30 sen per share).
REVIEW OF OPERATIONS
The results of PPB’s business operations for 2018 are summarised as follows :-
- Revenue from the Grains and agribusiness segment was up by 5% to RM3.15 billion on the back of higher sales from all flour mills. Segment profit decreased by 6% attributable mainly to higher raw material costs.
- Consumer products segment revenue was lower by 5% at RM 641 million mainly due to lower sales of in-house products. Segment profit was lower at RM15 million due mainly to the absence of a one-time gain on sale of land and building of RM8.0 million recorded in 2017, higher raw material costs and plant maintenance cost at the bakery division.
- Revenue from the Film exhibition and distribution segment rose by 12% to RM538 million whilst segment profit went up by 17% to RM63 million in FY2018 mainly due to the strong performance of local Malay titles and contribution from cinemas opened in 2017
- The Environmental engineering and utilities segment recorded higher revenue of RM205 million for FY2018, up 57% compared with FY2017. Segment profit more than doubled to RM15 million mainly attributable to progressive profits recognised from on-going water treatment plant projects.
- Property segment revenue went up by 11% to RM53 million. Segment profit increased two-fold to RM12 million mainly attributable to higher income from project management fees and rental on completion of the Cheras LeisureMall extension.
- Combined revenue from Investments and Other Operations was 14% lower to RM120 million. The de-consolidation of Tefel Packaging Industries Co Ltd (Tefel) upon its disposal in June 2018 contributed to the lower segment revenue. The combined segment profit increased 57% to RM15 million mainly attributable to higher investment income and deconsolidation of the loss-making Tefel.
PROSPECTS FOR 2019
The Malaysian economy recorded a sustained growth of 4.7% in 2018. The economy is expected to continue to expand on a steady growth pace in 2019. Private sector demand, with the support of continued income and employment growth, will remain the main driver.
The Grains and agribusiness segment is expected to remain competitive on the back of a volatile commodity market and it will continue to focus on volume growth and maintaining good quality standard of our products. The performance of the Consumer products segment is expected to remain stable, supported by a widening product range and the introduction of new products into new markets. The Film exhibition and distribution segment will continue to be driven by strong title releases, opening of new cinemas, introduction of new cinematic technology and facilities in selected locations. The Environmental engineering and utility segment will focus on replenishing its order book while maintaining its focus on quality work and execution. Amidst a challenging operating environment, the Property division will focus on completing the Megah Rise project in Petaling Jaya while striving to maintain and improve operational excellence in its existing mall and property management business.
While the Group's main business segments are expected to perform satisfactorily in financial year 2019, the overall Group financial results would depend substantially on Wilmar’s business performance.