Genting Bhd makes big turnaround to post RM929.20mil net profit in FY23

KUALA LUMPUR: Genting Bhd registered a net profit of RM929.20 million in the financial year ended Dec 31, 2023 (FY2023) compared to a net loss of RM299.90 million a year ago.

Its revenue jumped to RM27.12 billion from RM22.38 billion, boosted by the leisure and hospitality businesses in the United States, Bahamas, United Kingdom and Egypt.

It said in a statement today that its revenue from the power segment improved mainly due to higher generation from the Banten Plant in Indonesia following a shorter outage period of 31 days.

Nevertheless, the revenue from the plantation division for FY2023 was lower mainly due to weaker palm product prices, which outweighed the improvement in the fresh fruit bunches (FFB) production mainly driven by the Indonesian estates.

The oil and gas unit recorded lower revenue due to lower global crude oil prices in FY2023.

For the fourth quarter, it posted a net profit of RM150.10 million from a net loss of RM168.72 million, riding on a higher revenue of RM7.27 billion from RM6.36 billion previously.

A lower loss before interest, tax, depreciation and amortisation recorded from investments and others was mainly attributable to recognition of net unrealised foreign exchange gains from subsidiary Genting Malaysia Bhd group’s US dollar denominated borrowings compared with net unrealised foreign exchange losses in the fourth quarter of FY2022.

For FY2024, Genting Malaysia group remains cautious of the near-term prospects of the leisure and hospitality industry but is positive in the longer term.

ALSO READ: Genting Malaysia posts RM240mil net profit in 4Q, declares 9 sen dividend

Genting Plantations Bhd expects palm oil prices to remain supported by global supply tightness owing to weaker production prospects amid uncertain weather conditions and growing biodiesel demand globally.

“Barring any adverse weather conditions, Genting Plantations anticipates a better harvest for 2024, spurred by additional harvesting areas and progression of existing mature areas into higher yielding brackets in Indonesia.

“However, the production growth may be moderated by ongoing replanting activities in Malaysia activities,” it said.

Meanwhile, the downstream manufacturing segment is anticipated to face stiffer competition from its Indonesian counterparts, which enjoy competitive pricing for feedstock due to price differential arising from the imposition of export levy.

Additionally, the rising cost of production continues to pose challenges to the segment and the segment’s palm-based biodiesel will continue to cater mainly to Malaysian biodiesel mandate as biodiesel export remains challenging.

It said the property segment will continue to offer products catering to a broader market segment in its Batu Pahat and Kulai-based projects, which have been well received.

ALSO READ: Genting Plantations’ FY23 net profit slips to RM253.48mil

Upcoming catalytic developments, inter alia the Johor-Singapore Special Economic Zone and Rapid Transit System are generally expected to generate interest and demand in the Johor property market.

On top of that, the group’s supercritical coal-fired Banten power plant in Indonesia is expected to operate with a high plant load factor and availability as per the grid load requirements by the off-taker, PT PLN (Persero), with the completion of its major outage in February 2024.

“A positive outlook is expected from our 49 per cent owned joint venture, SDIC Genting Meizhou Wan Electric Power Company Ltd in anticipation of stable domestic and global coal prices being supported by balanced supply and demand,” it noted.

Meanwhile, Jangi Wind Farm’s performance is expected to be back on track in 2024 after the completion of repair works for the wind turbine generators.

Genting Bhd has declared a final single-tier dividend of 9 sen per share payable on April 19, 2024. – Bernama