- Revenue of RM2.3 billion recorded for the first quarter.
- EBITDA stood at RM107 million for the first quarter.
- Earnings impacted by challenging environment as a result of Covid-19 pandemic and the Movement Control Order (MCO).
KUALA LUMPUR, June 19, 2020 – Boustead Holdings Berhad (BHB) recorded a revenue of RM2.3 billion for its first quarter ended 31 March 2020. Earnings before interest, tax, depreciation and amortisation (EBITDA) for the period stood at RM107 million.
The Group’s bottom line was affected by weaker performances by the Trading, Finance & Investment, Property & Industrial and Heavy Industries Divisions. This saw the Group record a loss before tax of RM53 million for the quarter under review.
Segmental results for the Divisions during the first quarter are tabulated below. To strengthen alignment, enhance organisational culture and provide greater synergies across the Group, its core businesses have been streamlined into five Divisions.
• The Pharmaceutical Division turned in a higher profit of RM29 million (Q1 2019: RM26 million), as the bottom line benefitted from the absence of amortisation of concession rights, which was fully recognised in the preceding fourth quarter at the Group level. Stronger contribution from Governments hospital and lower operating costs also supported the improved performance.
• The Plantation Division registered a profit of RM1 million compared with a deficit in the previous year’s quarter. This was primarily attributable to better palm product prices in the quarter under review.
• The Trading, Finance & Investment Division posted a loss of RM22 million, mainly due to a stockholding loss by Boustead Petroleum Marketing as a result of the sharp drop in fuel price as well as lower sales volume during the MCO period. Tourism related subsidiaries under the Division including Boustead Travel Services and Boustead Cruise Centre were also impacted by the Covid-19 pandemic and MCO restrictions, while Affin Bank recorded lower contribution due to additional allowance for credit impairment losses and higher overhead expenses. This offset the positive contribution from the University of Nottingham in Malaysia.
• The Property & Industrial Division incurred a deficit of RM25 million, mainly due to weaker performances from its hotel and industrial segments. The hotel segment was weighed down by the Covid-19 pandemic, while the industrial segment was affected by lower demand for fibre cement board and other building materials, due to the temporary closure of construction projects during the MCO.
• The Heavy Industries Division recorded a deficit of RM37 million. This was primarily attributable to a loss incurred by Boustead Naval Shipyard, on higher foreign exchange loss and finance cost. In addition, no margin was recorded for the Littoral Combat Ship project due to cost overrun in FY2019.
Dato’ Seri Mohamed Khaled bin Nordin, Chairman of Boustead Holdings Berhad, said, “As a result of the Covid-19 pandemic and subsequent MCO, business activity essentially came to a halt in many industries. The Boustead Group was not spared the brunt of this, as most of our Divisions were affected, impacting earnings for the first quarter.”
“While this challenging situation is set to persist for 2020, we are positive that the Group-wide transformation exercise we are currently undergoing will enable us to weather through. With this plan underway, we aim to strengthen the Group’s operations and drive performance to see brighter prospects over the next three years,” concluded Dato’ Seri Mohamed Khaled.
About Boustead Holdings Berhad
Boustead Holdings Berhad (‘Boustead’), one of Malaysia’s oldest conglomerates, is Lembaga Tabung Angkatan Tentera (‘LTAT’)’s investment arm. The diversified Group comprises more than 90 subsidiaries, associate companies and joint ventures, and has substantial interests in various sectors of the Malaysian economy.
Its operations are focused in five key areas namely plantation, heavy industries, property & industrial, trading, finance & investment, and pharmaceutical.
Since its inception as a modest trading entity more than 190 years ago, the Boustead Group has grown by leaps and bounds. As at 31 March 2020, Boustead Holdings Berhad’s paid-up capital was RM2.7 billion while its shareholders’ funds stood at RM3.6 billion. Market capitalisation is currently in the region of RM1.3 billion. For more information on Boustead, log on to www.boustead.com.my.
Forward looking statements
This release may contain certain forward-looking statements with respect to the financial conditions, results of operations and business of the Group and certain plans and objectives of Boustead Holdings Berhad with respect to these items. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future and there are many factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements.