KUALA LUMPUR: SD Guthrie Bhd is poised for a stronger headline profits in the second half of 2025 (2H25), lifted by RM500 million land disposal gains, said Maybank Investment Bank Bhd (Maybank IB).
Its senior analyst Ong Chee Ting said the potential gains is expected to lift earnings despite weaker plantation performance on lower average selling prices (ASPs).
He said the group’s second quarter FY25 core profit after tax and minority interests (Patmi) once again beat market expectations, largely driven by higher-than-expected ASPs supported by forward sales earlier in the year.
SD Guthrie posted a core Patmi of RM466 million for the quarter, up 16 per cent on yearly basis but down 14 per cent from the first quarter.
This brings the first half core Patmi to RM1.01 billion, a 61 per cent jump from the same period last year and equivalent to 61 per cent of Maybank IB’s and 58 per cent of consensus full-year estimates.
Tan said SD Guthrie maintained its full-year fresh fruit bunches growth guidance at 3-5 per cent, with Maybank IB forecasting the upper end at five per cent.
Meanwhile first half output, up three per cent, represented 46 per cent of FY25 estimates.
On pricing strategy, the group has limited forward sales for the rest of the financial year, averaging around RM4,100 per tonne.
Despite guiding for a stable full-year unit cost of RM2,500 per tonne, SD Guthrie expects improving yields to lower second half of the year’s (2H25) cost below the RM2,600 per tonne recorded in 1H25.
“Following the strong set of results, we raise our financial year 2025 (FY25) core Patmi by six per cent mainly on higher upstream contribution on higher crude palm oil ASP while trimming downstream earnings.
“Our FY26-FY27 core Patmi estimates are kept broadly unchanged. Our earnings forecasts have yet to factor in potential land sales gains in 2H25,” Tan added.
The firm kept its “Buy” call on SD Guthrie with a higher target price of RM5.64.
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