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KRETAM HOLDINGS BERHAD — Interim / Quarterly Report 2026
May 27, 2026
70902_rns_2026-05-27_fb446b80-c52e-4d92-b0d8-adeea7d73ed1.pdf
Interim / Quarterly Report
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KRETAM HOLDINGS BERHAD
Company No.: 198801000928 (168285-H)
INTERIM FINANCIAL REPORT FOR THE QUARTER ENDED 31 MARCH 2026
This interim financial report is unaudited and should be read in conjunction with the Company's audited financial statements for the year ended 31 December 2025.
A. CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS
| CURRENT QUARTER | CUMULATIVE | |||||
|---|---|---|---|---|---|---|
| Quarter ended 31 Mar | 3 months ended 31 Mar | |||||
| 2026 | 2025 | Changes | 2026 | 2025 | Changes | |
| RM'000 | RM'000 | % | RM'000 | RM'000 | % | |
| CONTINUING OPERATIONS:- | ||||||
| Revenue | 182,095 | 167,099 | 9% | 182,095 | 167,099 | 9% |
| Cost of sales and services | (156,231) | (132,860) | (156,231) | (132,860) | ||
| Gross profit | 25,864 | 34,239 | -24% | 25,864 | 34,239 | -24% |
| Selling and distribution costs | (34) | (62) | (34) | (62) | ||
| 25,830 | 34,177 | 25,830 | 34,177 | |||
| Other income | 11,715 | 7,677 | 11,715 | 7,677 | ||
| Administrative expenses | (5,004) | (4,966) | (5,004) | (4,966) | ||
| Other expenses | (20,520) | (1,332) | (20,520) | (1,332) | ||
| Profit/(loss) before interest and Taxation | 12,021 | 35,556 | -66% | 12,021 | 35,556 | -66% |
| Finance income | 1,386 | 1,142 | 1,386 | 1,142 | ||
| Finance costs | (751) | (829) | (751) | (829) | ||
| Profit/(loss) before taxation | 12,656 | 35,869 | -65% | 12,656 | 35,869 | -65% |
| Taxation | (7,578) | (7,813) | (7,578) | (7,813) | ||
| Discontinued operation | 0 | 0 | 0 | 0 | ||
| Profit/(loss) after taxation | 5,078 | 28,056 | -82% | 5,078 | 28,056 | -82% |
| Profit/(loss) after taxation attributable to:- | ||||||
| Shareholders of the Company | 5,070 | 28,043 | -82% | 5,070 | 28,043 | -82% |
| Non-Controlling Interests | 8 | 13 | 8 | 13 | ||
| 5,078 | 28,056 | -82% | 5,078 | 28,056 | -82% | |
| EARNINGS/(LOSS) PER SHARE (EPS):- | Sen | Sen | Sen | Sen | ||
| Basic EPS | 0.22 | 1.22 | 0.22 | 1.22 | ||
| Diluted EPS | 0.22 | 1.22 | 0.22 | 1.22 |
B. CONDENSED CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME
| CURRENT QUARTER | CUMULATIVE | |||||
|---|---|---|---|---|---|---|
| Quarter ended 31 Mar | 3 months ended 31 Mar | |||||
| 2026 | 2025 | Changes | 2026 | 2025 | Changes | |
| RM'000 | RM'000 | % | RM'000 | RM'000 | % | |
| Profit/(loss) after taxation | 5,078 | 28,056 | -82% | 5,078 | 28,056 | -82% |
| Other Comprehensive Income (OCI) | 0 | 0 | 0 | 0 | ||
| Income tax relating to components of OCI | 0 | 0 | 0 | 0 | ||
| Other Comprehensive Income net of tax | 0 | 0 | 0 | 0 | ||
| Total Comprehensive Income/(loss) | 5,078 | 28,056 | -82% | 5,078 | 28,056 | -82% |
| Total Comprehensive Income/(loss) attributable to:- | ||||||
| Shareholders of the Company | 5,070 | 28,043 | -82% | 5,070 | 28,043 | -82% |
| Non-Controlling Interests | 8 | 13 | -38% | 8 | 13 | -38% |
| 5,078 | 28,056 | -82% | 5,078 | 28,056 | -82% |
C. CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
| | As at
31.03.2026
RM'000 | As at
31.12.2025
RM'000 |
| --- | --- | --- |
| NON-CURRENT ASSETS | | |
| Property, plant and equipment | 597,010 | 595,221 |
| Biological assets | 8 | 7 |
| Intangible assets | 42,777 | 42,777 |
| Inventories | 3,256 | 3,252 |
| Trade & other receivables | 0 | 0 |
| Deferred tax assets | 962 | 2,286 |
| Investment - Quoted Securities | 133,825 | 153,700 |
| CURRENT ASSETS | | |
| Biological assets | 6,495 | 6,001 |
| Inventories | 178,882 | 187,873 |
| Receivables | 87,348 | 115,606 |
| Tax refundable | 7,458 | 5,491 |
| Derivatives | 0 | 0 |
| Cash and bank balances | 229,760 | 201,757 |
| | 509,943 | 516,728 |
| Assets of disposal group classified as held for sale | 0 | 0 |
| | 509,943 | 516,728 |
| CURRENT LIABILITIES | | |
| Payables | 53,305 | 66,425 |
| Loans and borrowings | 40,813 | 58,447 |
| Derivatives | 366 | 5 |
| Income tax payable | 322 | 795 |
| | 94,806 | 125,672 |
| Liabilities directly associated with disposal group
classified as held for sale | 0 | 0 |
| | 94,806 | 125,672 |
| NET CURRENT ASSETS | 415,137 | 391,056 |
| NON-CURRENT LIABILITIES | | |
| Loans and borrowings | 25,969 | 26,978 |
| Deferred taxation | 89,398 | 88,791 |
| | 1,077,608 | 1,072,530 |
| EQUITY | | |
| Equity attributable to shareholders of the Company | | |
| Share capital | 746,467 | 746,467 |
| Reserves | (18,549) | (18,549) |
| Retained profits /(losses) | 348,076 | 343,006 |
| Reserve of disposal group classified as held for sale | 0 | 0 |
| | 1,075,994 | 1,070,924 |
| Equity attributable to non-controlling interests | 1,614 | 1,606 |
| | 1,077,608 | 1,072,530 |
| | Sen | Sen |
| NET ASSETS PER SHARE | 46.9 | 46.6 |
D. CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
| EQUITY ATTRIBUTABLE TO:- | ||||||
|---|---|---|---|---|---|---|
| Shareholders of the Company | Non-controlling Interests | TOTAL EQUITY | ||||
| Share Capital | Treasury Shares | Retained Profits | TOTAL | |||
| RM'000 | RM'000 | RM'000 | RM'000 | RM'000 | RM'000 | |
| CURRENT YEAR TO DATE: | ||||||
| At 1 January 2026 | 746,467 | (18,549) | 343,006 | 1,070,924 | 1,606 | 1,072,530 |
| Purchase of Treasury shares | 0 | 0 | 0 | 0 | 0 | 0 |
| Total Comprehensive Income/(loss) for the period | 0 | 0 | 5,070 | 5,070 | 8 | 5,078 |
| Dividend declared/paid | 0 | 0 | 0 | 0 | 0 | 0 |
| Dividend paid to non-controlling interests | 0 | 0 | 0 | 0 | 0 | 0 |
| At 31 March 2026 | 746,467 | (18,549) | 348,076 | 1,075,994 | 1,614 | 1,077,608 |
| PREVIOUS YEAR CORRESPONDING PERIOD: | ||||||
| At 1 January 2025 | 746,467 | (15,865) | 313,569 | 1,044,171 | 1,460 | 1,045,631 |
| Purchase of Treasury shares | 0 | (2,045) | 0 | (2,045) | 0 | (2,045) |
| Total Comprehensive Income/(loss) for the period | 0 | 0 | 28,043 | 28,043 | 13 | 28,056 |
| Dividend declared/paid | 0 | 0 | 0 | 0 | 0 | 0 |
| Dividend paid to non-controlling interests | 0 | 0 | 0 | 0 | 0 | 0 |
| At 31 March 2025 | 746,467 | (17,910) | 341,612 | 1,070,169 | 1,473 | 1,071,642 |
E. CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
| 3 months ended 31 Mar | ||
|---|---|---|
| 2026 | ||
| RM'000 | 2025 | |
| RM'000 | ||
| Cash flows from operating activities | ||
| Profit/(loss) before taxation from continuing operations | 12,656 | 35,869 |
| Adjustments for:- | ||
| Dividend income | 0 | 0 |
| Depreciation and amortisation | 12,224 | 11,747 |
| Net fair value loss/(gain) on biological assets | (495) | 49 |
| Interest income | (1,386) | (1,142) |
| Finance costs | 751 | 829 |
| Net loss/(gain) on disposal of assets | (8) | 45 |
| Unrealised loss/(gain) on derivatives | 361 | (238) |
| Unrealised loss/(gain) on foreign exchange | (114) | 0 |
| Provision for and write-off/(reversal) of inventories | (3,736) | (162) |
| Provision for inventory obsolescence | 0 | 0 |
| Fixed assets written off | 0 | 105 |
| Fair value (gain)/loss on investment securities | 19,875 | (2,650) |
| Loss/(gain) on disposal of investment securities | 0 | 0 |
| Net (gain)/loss on impairment of financial instruments | 0 | 0 |
| Reversal of allowance for impairment of receivables | 0 | 0 |
| Impairment loss on property, plant and equipment | 0 | 0 |
| Changes in working capital | 27,975 | 7,031 |
| Income taxes paid, net of refunds | (8,087) | (5,995) |
| Interest received | 1,386 | 1,142 |
| Interest paid | (751) | (829) |
| Capital gain tax paid | 0 | 0 |
| 60,651 | 45,801 | |
| Cash flows from investing activities | ||
| Purchase of property, plant and equipment | (14,013) | (11,108) |
| Proceeds from disposal of property, plant and equipment | 8 | 80 |
| Purchase of Quoted shares | 0 | 0 |
| Proceeds from disposal of Quoted shares | 0 | 0 |
| Withdrawal/(placement) of fixed deposits of longer-term tenure | 0 | 0 |
| Dividend received | 0 | 0 |
| (14,005) | (11,028) | |
| Cash flows from financing activities | ||
| Net drawdown/(repayment) of lease liabilities | (81) | (78) |
| Net drawdown/(repayment) of revolving credit, term loan & foreign bill of exchange | (18,562) | (33,431) |
| Repurchase of own share | 0 | (2,045) |
| Payment of dividends to shareholders | 0 | 0 |
| Payment of dividends to non-controlling interests | 0 | 0 |
| (18,643) | (35,554) | |
| Increase/(decrease) in cash and cash equivalents | 28,003 | (781) |
| Cash and cash equivalents at the beginning of the year | 201,757 | 147,929 |
| Cash and cash equivalents at the end of the period | 229,760 | 147,148 |
| Cash and cash equivalents comprise the following: | ||
| Cash and bank balances | 229,760 | 147,148 |
| less: Fixed deposits with maturity of more than 3 months | 0 | 0 |
| 229,760 | 147,148 |
F. EXPLANATORY NOTES PURSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARD MFRS 134
- ACCOUNTING POLICIES
The interim financial statements are prepared as required by Paragraph 9.22 of the Bursa Malaysia Securities Berhad (“Bursa Securities”) Listing Requirements and comply with Malaysian Financial Reporting Standard (MFRS 134) Interim Financial Reporting issued by the Malaysian Accounting Standards Board (MASB).
(a) Changes to Accounting Policies
The accounting policies and methods of computation used in the preparation of the interim financial statements are consistent with those used in the preparation of the audited financial statements for the year ended 31 December 2025.
(b) Malaysian Financial Reporting Standards (“MFRS”) and MFRS Framework
The interim financial statements of the Group for the financial period ended 31 March 2026 was prepared in accordance with the Malaysian Financial Reporting Standards (“MFRS”) Framework.
At the date of authorisation of these interim financial statements, the following MFRS, IC Interpretations and Amendments to IC Interpretations were issued but not yet effective and have not been applied by the Group:
| MFRS, IC Interpretation and Amendments to IC Interpretations | Effective for annual periods beginning on or after |
|---|---|
| ○ Amendments to MFRS 121 – Translation to a Hyperinflationary Presentation Currency | 1 January 2027 |
| ○ MFRS 18 – Presentation and Disclosure in Financial Statements | 1 January 2027 |
| ○ MFRS 19 – Subsidiaries with Public Accountability: Disclosures | 1 January 2027 |
| ○ Amendments to MFRS 10 and MFRS 128 - Sale or Contribution of Assets between an Investor and its Associates or Joint Venture | Deferred |
- SEASONAL OR CYCLICAL FACTORS
The Group's production from its plantations generally experiences an "up-down" cycle once a year, with low production usually in the early part of the year, and peak production in the second half of the year but such cyclical crop pattern can be affected by the changes in weather conditions.
The prices for the Group’s products are not within the control of the Group and it is mainly determined by the global supply and demand situation for edible oils.
- SIGNIFICANT ITEMS/EVENTS
There were no items or events which arose during the period under review, which affected assets, liabilities, equity, net income or cash flows, which are unusual by reason of their nature, size or incidence except for the fair value loss on investment securities of RM19.9 million during the quarter ended 31.03.2026.
- MATERIAL CHANGES IN ACCOUNTING ESTIMATES
During the period under review, there were no:
(i) material changes in estimates of amounts reported in the previous interim periods of the current financial year; and
(ii) material changes in estimates of amounts reported in prior financial years.
- DEBT AND EQUITY SECURITIES
During the current financial year to date, there was no repurchase of ordinary shares from the open market. The shares previously purchased are held as treasury shares. As at 31 March 2026, the number of treasury shares held was 32,549,000 ordinary shares.
- PAYMENT OF DIVIDENDS
There were no dividends paid during the period under review.
7
7. SEGMENT REVENUE AND RESULTS
For the three months 31 March 2026
| Plantation & Mill | Refinery | Elimination | TOTAL | |
|---|---|---|---|---|
| RM'000 | RM'000 | RM'000 | RM'000 | |
| REVENUES AND RESULTS:- | ||||
| Segment Revenue – external | 21,224 | 160,871 | 0 | 182,095 |
| Inter-segment revenue | 76,661 | 0 | (76,661) | 0 |
| 97,885 | 160,871 | (76,661) | 182,095 | |
| Segment results | 26,780 | 5,095 | (144) | 31,731 |
| Unallocated Items:- | ||||
| Other income | 1,386 | |||
| Other expenses | (19,875) | |||
| Corporate expenses | (586) | |||
| Profit/(loss) before taxation from continuing operations | 12,656 | |||
| Taxation | (7,578) | |||
| Profit/(loss) after taxation from continuing operations | 5,078 | |||
| ASSETS:- | ||||
| Segment assets | 781,077 | 358,178 | 1,139,255 | |
| Unallocated assets/(liabilities) | 148,526 | |||
| Assets classified as held for sale | 0 | |||
| Total assets | 1,287,781 |
For the three months 31 March 2025
| Plantation & Mill | Refinery | Elimination | TOTAL | |
|---|---|---|---|---|
| RM'000 | RM'000 | RM'000 | RM'000 | |
| REVENUES AND RESULTS:- | ||||
| Segment Revenue – external | 20,524 | 146,575 | 0 | 167,099 |
| Inter-segment revenue | 80,442 | 0 | (80,442) | 0 |
| 100,966 | 146,575 | (80,442) | 167,099 | |
| Segment results | 23,388 | 9,741 | (375) | 32,754 |
| Unallocated Items:- | ||||
| Other income | 3,792 | |||
| Other expenses | 0 | |||
| Corporate expenses | (677) | |||
| Profit/(loss) before taxation from continuing operations | 35,869 | |||
| Taxation | (7,813) | |||
| Profit/(loss) after taxation from continuing operations | 28,056 |
The Group is organized into business units based on their products and services, and has two reportable operating segments as follows:
a. The plantation and mill segment is in the business of cultivation and sales of oil palm products. This reportable segment has been formed by aggregating the fertilizer operating segment, which is regarded by management to be an integral part of the Group's plantation operations by reason of the quantity of the fertilizer segment's operating output that is used in the plantation operations.
b. The refinery segment is in the business of sales of crude palm oil, refining and producing palm methyl ester (PME).
8. VALUATIONS OF PROPERTY, PLANT AND EQUIPMENT
There is no revaluation of property, plant and equipment during the current quarter.
8
9. CAPITAL COMMITMENTS
As at 31 March 2026, there were no material capital commitments for capital expenditure, contracted for or known to be contracted for by the Group which might have a material impact on the financial position or business of the Group, except as disclosed below:
| As at | 31.03.2026 |
|---|---|
| RM'000 | |
| Approved and contracted for | 23,986 |
| Approved but not contracted for | 67,809 |
| 91,795 |
10. SUBSEQUENT EVENTS
Subsequent to the end of the period under review, the investment in quoted securities have declined in the share market. The total investment in quoted securities are fair valued as RM 113,949,957 at 27 May 2026.
11. EFFECT OF CHANGES IN THE COMPOSITION OF THE GROUP
During the period under review, there were no significant changes in the composition of the Group including acquisitions or disposal of subsidiaries and discontinued operations.
12. CHANGES IN CONTINGENT LIABILITIES OR CONTINGENT ASSETS SINCE THE LAST FINANCIAL YEAR
There were no changes in contingent liabilities or contingent assets since 31 December 2025.
G. EXPLANATORY NOTES PURSUANT TO APPENDIX 9B OF THE LISTING REQUIREMENTS OF BURSA MALAYSIA SECURITIES BERHAD
13. REVIEW OF PERFORMANCE
For the 3 months of 2026, the Group recorded a total revenue of RM 182.1 million (2025: RM 167.1 million) and a pre-tax gain of RM 12.7 million (2025: pre-tax gain of RM 35.9 million). The decline in pre-tax profit was primarily due to a fair value loss of RM 19.9 million on investment securities in contrast to a fair value gain of RM 2.6 million recorded in 2025.
The commentaries below should be read in conjunction with tables shown in Note 13 (B) - Key Performance Indicators.
(A) Commentary on the performance of the operating segments of the Group for current Q1 2026 vs current Q1 2025 is as follows:
(i) Plantations and Mills
As shown in Note 7, the Group’s plantation and mill operations achieved revenue (including inter-segment revenue) of RM 97.9 million (2025: RM 101.0 million), and pre-tax gain of RM 26.8 million (2025: pre-tax gain of RM 23.4 million).
Operating revenue for the first quarter of 2026 decreased compared to the corresponding period in 2025. This decline was primarily driven by lower average selling prices for FFB and CPO with the impact partially offset by higher sales volume during the quarter as demonstrated in Table A and Table B respectively.
The plantation division’s pre-tax gain has increased during the first quarter of 2026 when compared to the last corresponding period mainly due to the following:
a) Lower estate upkeep cost resulting from the delayed manuring activities caused by heavy rainfall early in the year.
b) Lower windfall profit levy payments attributable to lower average CPO selling price as illustrated in Table A.
(ii) Refinery
As shown in Note 7, the Group’s refinery operations achieved revenue of RM 160.9 million (2025: RM 146.6 million) and generated a pre-tax gain of RM 5.1 million (2025: pre-tax gain of RM 9.7 million).
Operating revenue for the refinery division in the first quarter of 2026 is higher when compared to the corresponding period primarily driven by higher sales volume of PFAD and CPO. This is partially offset with the lower average sales price for PME.
The refinery division's pre-tax gain has decreased during the first quarter of 2026 when compared to the last corresponding period primarily due to declining margin from PME sales resulted from lower average selling price for PME.
(B) Key Performance Indicators:
Table A: Crude palm oil (CPO) and palm kernel (PK) prices – Sabah MPOB* average
| CPO | PK | |||
|---|---|---|---|---|
| 2026 | 2025 | 2026 | 2025 | |
| January | 3,993.00 | 4,566.50 | 3,080.00 | 3,250.00 |
| February | 4,015.00 | 4,700.00 | 2,940.00 | 3,456.50 |
| March | 4,300.50 | 4,648.00 | 3,019.50 | 3,535.50 |
| April | 4,480.50 | 4,219.50 | 3,535.50 | 3,515.00 |
| May | 3,880.00 | 3,225.00 | ||
| June | 3,940.50 | 2,700.00 | ||
| July | 4,093.50 | 3,020.00 | ||
| August | 4,318.50 | 3,400.00 | ||
| September | 4,329.00 | 3,453.50 | ||
| October | 4,393.50 | 3,430.00 | ||
| November | 4,099.00 | 3,100.00 | ||
| December | 4,053.50 | 3,083.50 |
Table B: Output indicators, and comparison with industrial average
| 1st Quarter | Year to Date | |||||
|---|---|---|---|---|---|---|
| 2026 | 2025 | % change | 2026 | 2025 | % change | |
| FFB Production (mt) | 71,464 | 67,933 | 5.2% | 71,464 | 67,933 | 5.2% |
| FFB Yield (mt/hectare): | ||||||
| The Group’s estates | 4.24 | 4.01 | 5.8% | 4.24 | 4.01 | 5.8% |
| MPOB* Sabah average | 3.94 | 3.35 | 17.6% | 3.94 | 3.35 | 17.6% |
| CPO Closing Stock at Palm Oil Mills (mt) | 10,388 | 4,629 | 124.4% | 10,388 | 4,629 | 124.4% |
| Oil Extraction Rate: | ||||||
| The Group's palm oil mills | 20.61% | 19.48% | 5.8% | 20.61% | 19.48% | 5.8% |
| MPOB* Sabah average | 20.68% | 19.62% | 5.4% | 20.68% | 19.62% | 5.4% |
*MPOB = Malaysian Palm Oil Board
- COMPARISON WITH THE PREVIOUS QUARTER'S RESULTS
The following is a summary based on the two respective quarters' condensed consolidated income statements:
| Current Quarter RM'000 | Previous Quarter RM'000 | Changes % | |
|---|---|---|---|
| CONTINUING OPERATIONS:- | |||
| Revenue | 182,095 | 211,263 | -14% |
| Cost of sales and services, including distribution | (156,265) | (167,986) | |
| 25,830 | 43,277 | ||
| Other income | 11,715 | 6,139 | |
| Administrative and other expenses | (25,524) | (66,889) | |
| Profit/(loss) before interest and taxation | 12,021 | (17,473) | 169% |
| Interest income | 1,386 | 1,916 | |
| Interest costs | (751) | (824) | |
| Profit/(loss) before taxation | 12,656 | (16,381) | 177% |
| Taxation | (7,578) | (12,570) | |
| Profit from continuing operations, net of tax | 5,078 | (28,951) | 118% |
| Discontinued operation | 0 | 0 | |
| Profit/(loss) after taxation | 5,078 | (28,951) | 118% |
Profit/(loss) after taxation attributable to:
| Shareholders of the Company | 5,070 | (28,993) | 117% |
|---|---|---|---|
| Non-Controlling Interests | 8 | 42 | |
| 5,078 | (28,951) | 118% |
In Q1 2026, the profit before taxation was higher compared to previous quarter mainly attributable to fair value loss on investment securities of RM 19.9 million during current quarter as compared to fair value loss of RM 63.6 million in the previous quarter. This was partially offset by the decline in sales volume and average selling price for FFB, CPO, PK and PME.
15. CURRENT YEAR PROSPECTS AND OUTLOOK
The CPO prices experienced notable fluctuations in Q1 2026, trading between RM3,938/MT and RM4,700/MT. Entering 2026, market sentiment remained subdued due to elevated stock levels which pressured prices. Malaysia's palm oil inventories stood at 3,051,147 MT in December 2025 before decreasing significantly to 2,270,574 MT by March 2026, primarily driven by lower seasonal production and improving demand.
Global policy developments continued to influence market sentiment throughout the quarter. In January 2026, Indonesia officially announced the postponement of its B50 biodiesel mandate while the United States moved towards removing certain import penalties and was expected to finalise its 2026 biofuel quotas by March. At the same time, import demand from key consuming countries such as India and China improved as palm oil regained price competitiveness against alternative edible oils, supported by pre-festive demand. Towards the end of the quarter, escalating geopolitical tensions in the Middle East involving the United States, Israel, and Iran contributed to a sharp increase in crude oil prices amid supply disruption concerns. This served as an additional catalyst for higher CPO prices through improved biodiesel economics and stronger sentiment across the vegetable oil market.
Beyond March 2026, CPO prices are expected to remain volatile amid evolving market conditions. This outlook is influenced by anticipated improvements in production in the upcoming quarters and potential policy shifts by the Indonesian government concerning the B50 biodiesel mandate which is currently targeted for implementation in July 2026. Broader macroeconomic and geopolitical uncertainties, particularly escalating tensions in the Middle East may continue to weigh on global growth prospects, supply chain stability and investor sentiment.
Against the current headwinds, the Group remains cautiously optimistic about its 2026 outlook. This confidence stems from management's ongoing initiatives to enhance performance and execute robust transformation strategies. To strengthen resilience amid evolving industry dynamics, the Group focuses on three key pillars: proactive risk management, strict cost control and technology-driven productivity gains to improve efficiency and maximise yields.
16. ACHIEVEMENT OF REVENUE/PROFIT ESTIMATES, FORECASTS AND/OR INTERNAL TARGETS
Not applicable as the Company did not provide any revenue or profit estimate, forecast or projection, and did not publish any internal targets, in any public document.
17. EXPLANATION OF VARIANCES FROM PROFIT FORECAST OR PROFIT GUARANTEE
Not applicable as the Company did not provide any profit forecast or guarantee, in any public document.
18. TAXATION
| Quarter Ended 31.03.2026 RM'000 | 3 months Ended 31.03.2026 RM'000 | |
|---|---|---|
| Provision in respect of results for the current quarter/period | (5,647) | (5,647) |
| Capital gain tax | 0 | 0 |
| (Under) / Over provision for taxation in respect of previous years | 0 | 0 |
| Deferred tax (expense) / benefit | (1,931) | (1,931) |
| (7,578) | (7,578) |
The Group's tax expense on its Profit Before Tax for the year 2026 is higher than the statutory tax rate due to fair value loss on investment securities of RM 19.9 million which is non-deductible.
11
19. STATUS OF CORPORATE PROPOSALS ANNOUNCED BUT NOT YET COMPLETED
(a) Bulking Joint Venture Agreement ("BJVA")
On 7 July 2014, Usaha Dimega Sdn Bhd ("UDSB"), a wholly-owned subsidiary of the Group, entered into a conditional Bulking Joint Venture Agreement ("BJVA") with Rikaworth Sdn Bhd ("RSB") and Sawit Bulkers Sdn Bhd ("SBSB") to venture into the business of palm oil common bulking installations for palm oil and related products together with a system of pipe racks to facilitate the transfer of liquid products between the bulking facilities and users of such facilities and the conveyance of the same to and from the jetty facilities of the Sabah Ports Authority in Sandakan, subject to the terms and conditions of the BJVA.
The BJVA is subject to the fulfilment (unless waived by mutual written consent of UDSB and RSB) of certain Conditions Precedent, after which UDSB and RSB are to subscribe for shares at par in the JV Company in cash on a date to be decided by the Board of Directors of the JV Company within 10 days after the Conditions Precedent are fulfilled or waived. Following the subscription of shares, the equity interest held by the respective parties shall be as follows:
| No. of Shares | Percentage | |
|---|---|---|
| UDSB | 12,750,000 | 60% |
| RSB | 8,500,000 (including the existing 100,000 issued shares) | 40% |
The status of the Conditions Precedent are as follows:
| Conditions Precedent | Status | |
|---|---|---|
| 1 | The approvals of RSB and UDSB for the rolling business plan for the JV Company relating to the then current financial year and three succeeding financial years | Obtained |
| 2 | RSB and UDSB obtaining the approvals of their respective shareholders to the terms and conditions of the BJVA | Obtained |
| 3 | Obtaining the licence/consent from the Malaysian Palm Oil Board to commence construction of the bulking installation | Obtained |
| 4 | Increasing the authorised capital of the JV Company to RM50,000,000 consisting of 50,000,000 shares of RM1.00 each | Done |
| 5 | RSB and UDSB agreeing to the form and substance of the Land Sale and Purchase Agreement relating to the purchase of the Land and price relating thereto | Not yet agreed |
| 6 | RSB and UDSB agreeing to the terms and conditions of the Bulking Facilities User Agreement relating to the use of the JV Company's bulking facilities by Green Edible Oil Sdn Bhd ("GEOSB") (a wholly-owned subsidiary of the Group) operating a refinery in the vicinity of the Sawit POIC Area to produce refined palm oil products | Done |
| 7 | The JV Company (as sublessee) and Sandakan Bulkers (as sublessor) agreeing to the terms and conditions of the Pipe Rack Land Sublease relating to the sublease of a strip of land on which the JV Company's pipe racks would be erected | Not yet agreed |
| 8 | Issuance of the letter of offer in respect of the alienation of the Land by the Lands and Surveys Department | Issued |
| 9 | The JV Company obtaining such other authorizations, consents and permits as shall be necessary for commencing its business according to written laws | In progress |
| 10 | Sandakan Bulkers (as landowner and licensor) and the Offtaker (as licensee) agreeing to the form of the Land Licence Agreement for Sandakan Bulkers to grant a licence for the Offtaker to use a stretch of land for the purpose of building a pipe rack to carry pipes for liquid goods and water pipe | Not yet agreed |
| 11 | RSB issuing a letter to the JV Company promising to insert into all future sale and purchase agreements in respect of the sale of various lots within the Sawit POIC Area, words to restrict the use of the said lots for conducting bulking business | Done |
| 12 | The execution and delivery of KHB's Guarantee issued in favour of RSB to guarantee the performance, liabilities and obligations of UDSB under the BJVA | Done |
| 13 | RSB and UDSB agreeing to the rate of charges payable to the JV Company for each metric ton of goods loaded onto any barge or vessel at the mini jetty located adjacent to GEOSB's land | In progress |
On 5 May 2016, UDSB received from RSB a draft Deed of Variation proposing the following major changes to the BJVA:
- the respective proportions in which UDSB and RSB will hold the issued ordinary share capital of the JV Company from time to time shall be as follows:
| Party | Percentage |
|---|---|
| UDSB | 40% |
| RSB | 60% |
- the BJVA shall be inserted with a new Condition Precedent as follows:
"The relevant authority shall have issued separate land titles in respect of the lands which are the subject matter of the Pipe Rack Land Sublease."
The draft Deed of Variation is under consideration by the Board of Directors and an announcement will be made once a decision has been made.
20. GROUP BORROWINGS
| | As at
31.03.2026
RM'000 | As at
31.12.2025
RM'000 |
| --- | --- | --- |
| Short term secured: | | |
| Bankers’ acceptances | 30,830 | 46,492 |
| Revolving credit | 6,000 | 8,000 |
| Term loans | 3,648 | 3,626 |
| Lease | 335 | 329 |
| | 40,813 | 58,447 |
| Long term secured: | | |
| Term loans | 23,407 | 24,329 |
| Lease | 2,562 | 2,649 |
| | 25,969 | 26,978 |
| TOTAL BORROWINGS | 66,782 | 85,425 |
The above borrowings are denominated in Malaysian Ringgit except where otherwise indicated.
21. ADDITIONAL DISCLOSURES
(a) Financial Derivatives
Outstanding financial derivatives held by the Group as at 31 March 2026 are as follows:
| | Currency | Contract/
Notional
Amount
'000 | Fair Value | |
| --- | --- | --- | --- | --- |
| | | | Assets
RM'000 | Liabilities
RM'000 |
| US Dollar forward contracts - less than 1 year | USD | 0 | 0 | 0 |
| Palm oil futures contracts - less than 1 year | MYR | 12,335 | 0 | 366 |
| Olein price swap contracts - less than 1 year | USD | 0 | 0 | 0 |
(b) Gains/(Losses) Arising from Fair Value Changes of Financial Liabilities
For the period ended 31 March 2026, there were no gains or losses arising from changes to fair values of the Group's financial liabilities.
22. CHANGES IN STATUS OF MATERIAL LITIGATION UP TO 27 MAY 2026.
Not applicable as the Group is not involved in any material litigation.
23. DIVIDENDS DECLARED
No dividend has been declared or recommended. (Financial year ended 31 December 2025: 1.5 sen per share)
24. EARNINGS/(LOSS) PER SHARE ("EPS")
Basic and diluted EPS for the period under review is calculated based on the following:
| Quarter ended 31.03.2026 | 3 months ended 31.03.2026 | |
|---|---|---|
| Weighted average number of shares in issue | 2,295,078,135 | 2,295,078,135 |
| Number of shares used in calculating diluted EPS | 2,295,078,135 | 2,295,078,135 |
| RM'000 | RM'000 | |
| Profit/(loss) after taxation from continuing operations | 5,078 | 5,078 |
| less: (profit)/loss after taxation from continuing operations attributable to non-controlling interests | (8) | (8) |
| Profit/(loss) after taxation from continuing operations attributable to shareholders of the Company | 5,070 | 5,070 |
| EPS: | Sen | Sen |
| - Basic | 0.22 | 0.22 |
| - Diluted | 0.22 | 0.22 |
Basic EPS is calculated by dividing "Profit/(loss) after taxation attributable to shareholders of the Company" by the "Weighted average number of shares in issue".
Diluted EPS is calculated by dividing "Adjusted profit/(loss) after taxation" by the "Number of shares used in calculating diluted EPS".
25. AUDITOR'S REPORT ON THE PREVIOUS YEAR'S FINANCIAL STATEMENTS
The auditors' report on the Group's consolidated financial statements for the year ended 31 December 2025 was not qualified.
26. STATEMENT OF COMPREHENSIVE INCOME
The statement of comprehensive income includes the following items:
| Quarter ended 31.03.2026 RM'000 | 3 months Ended 31.03.2026 RM'000 | |
|---|---|---|
| Interest income | (1,386) | (1,386) |
| Other income, including investment income | (11,000) | (11,000) |
| Interest expense | 751 | 751 |
| Depreciation and amortization | 12,224 | 12,224 |
| Foreign exchange loss/(gain) | 235 | 235 |
| Net provision/(reversal) of allowance for impairment of receivables | 0 | 0 |
| Provision for and write-off/(reversal) of inventories | (3,736) | (3,736) |
| Provision for inventory obsolescence | 0 | 0 |
| Fair value loss/(gain) on investment securities | 19,875 | 19,875 |
| Loss/(gain) on disposal of quoted or unquoted investments or properties | 0 | 0 |
| Impairment of assets | 0 | 0 |
| Loss/(gain) on disposal of subsidiary | 0 | 0 |
| Loss/(gain) on derivatives | 141 | 141 |
| Exceptional items | 0 | 0 |
27. AUTHORISED FOR ISSUE
The condensed consolidated interim financial statements were authorized for issue by the Board of Directors in accordance with a resolution of the Board on 28 May 2026.
By Order of the Board,
DATUK LIM NYUK SANG @ FREDDY LIM
Chief Executive Officer
28 May 2026
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