Agrochemical group Hextar Global posts 54% higher profit

KUALA LUMPUR: Hextar Global Bhd’s net profit improved 54% year-on-year to RM9.45 mil for the first quarter ended March 31 as revenue rose to RM104.57 mil from RM81.89 mil a year earlier.

This was due mainly to the enlarged agriculture segment and the incorporation of revenue from the consumer product segment following the reverse acquisition last year, it said in a filing with Bursa Malaysia today.

In April last year, Hextar Global, believed to be the country’s largest agrochemical firm, completed the acquisition of the entire equity interest in Hextar Chemicals Ltd (HCL), which produces pesticides and other agrochemicals, for RM596.79 mil via the issuance of new shares as well as RM17.9 mil in cash.

The group, which also produces hygiene disposable products, said despite the Covid-19 outbreak, it managed to increase its sales both locally and overseas and yielded a higher gross profit margin of 21.9%, an increase of 6.6% compared with 2019’s corresponding quarter.

“Being one of the biggest producers of agrochemicals in Malaysia, the group was able to secure sufficient inventories to operate without disruption from the Covid-19 impact,” it said.

The group recognised a net foreign exchange loss of RM1.56 mil in 1Q versus a net foreign exchange gain of RM0.62 mil in the corresponding quarter of last year.

“Had the group excluded the impact from foreign exchange, the group would have recorded an operating profit before taxation of RM14.12 mil compared to RM7.3 mil in the corresponding quarter of the preceding year, representing an increase of RM6.82 mil or 93.4%,” Hextar Global said.

The consumer products segment had turned around from a loss in the immediate preceding quarter to a profit-making position with a pre-tax profit of RM0.41 mil for 1Q20.

Hextar Global has proposed an interim dividend of 1 sen per share amounting to about RM8.06 mil for the financial year ending Dec 31, 2020.

Executive director Datuk Eddie Ong Choo Meng said the quarter’s financial results marked the best achievement since the completion of the reverse acquisition despite the impact from pandemic.

“Our agriculture segment achieved a higher-than-market performance and consumer products segment achieved the greatest turnaround from a loss to a profit-making position.

“Additionally, we have just commenced our smart agriculture business to embark on 5G technology in the plantation industry. Our strong business foundation was built by our core values and corporate philosophy of doing business the right way,” he added. – May 19, 2020, Bernama

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