BIOENERGY-based Elridge Energy Holdings Bhd foresees the increasing demand for sustainable energy solutions to drive strong uptake for its palm kernel shells (PKS) and wood pellets, particularly among international customers seeking reliable and high-quality biomass fuel sources.
Such outlook is reflected in both the financial performance and robust expansion of the biomass fuel industry in tandem with the group’s strategic positioning in the evolving market, according to Elridge’s CEO Oliver Yeo.
“Looking ahead, the group anticipates sustained global demand for innovative and high-quality biomass fuel products, spurred by worldwide energy transition initiatives,” commented Yeo in conjunction with the group’s latest financial results.
For its 4Q FY2024 ended Dec 31, 20240, Elridge posted a net profit of RM9.63 mil on the back of a revenue of RM95.55 mil attributable to “customers based in Japan, Thailand, Singapore, Indonesia and Malaysia”.
Material costs constituted the most significant component in the group’s sales cost, accounting for RM69.89 mil or 92.36% of its total cost of sales which amounted to RM75.67 mil for its 4Q FY2024.
No comparative figures for the preceding year’s corresponding quarter were available given Elridge was only listed on the ACE Market of Bursa Malaysia on Aug 22 last year.
From a cumulative perspective, the group recorded a revenue of RM389.05 mil in its FY2024 while its net profit came in at RM41.16 mil.
Revenue from the manufacturing of processed PKS remains a key driver at 85.16% while the trading of wood pellets contributed 14.84% of the total revenue for its FY2024.
According to the Independent Market Research report, the PKS industry in the Asia-Pacific region is projected to grow at a compound annual growth rate (CAGR) of 8.9%, expanding from an estimated US$308.6 mil (RM1.4 bil) in 2024 to US$366.1 mil (RM1.7 bil) by 2026.
Similarly, the wood pellet industry in the region is expected to grow at a CAGR of 8.6%, increasing from US$10.6 bil (RM48.4 bil) in 2024 to US$12.5 bil (RM57.1 bil) by 2026.
“Recognising the importance of production capacity in securing long-term supply contracts, particularly from international customers, we’re committed to expanding our PKS production capacity,” enthused Yeo.
“Foreign customers and end-users often prioritise suppliers with the ability to meet large-scale volume requirements consistently.
“To strengthen our position in this competitive market, the group is investing in the development of new manufacturing facilities in Pasir Gudang (Johor), Kuantan (Pahang) and Lahad Datu (Sabah).”
To-date, a total of RM68.14 mil from the group’s initial public offering (IPO) proceeds has been allocated for these expansion initiatives.
Each of the new facilities will be equipped with two PKS production lines with an estimated combined annual production capacity of 240,000 metric tonnes per site once fully operational.
This expansion will enable Elridge to meet increasing demand, enhance supply chain efficiencies and reinforce its market leadership in the renewable energy sector.
At the close of today’s (Feb 26) mid-day trading, Elridge was down 0.5 sen or 1.06% to 46.5 sen with 13.72 million shares traded, thus valuing the company at RM930 mil. – Feb 26, 2025
