The Star (06/11/2025) - PETALING JAYA: Plantation giant SD Guthrie Bhd believes crude palm oil (CPO) prices will be supported in the coming weeks by expectations of tighter supply, as the industry enters a seasonally low output cycle.

Despite palm oil’s narrowing price competitiveness against other vegetable oils, the group said demand is expected to remain resilient, especially as Indonesia reaffirmed plans to launch its B50 biodiesel mandate.

However, it concedes volatility in the vegetable oil market is likely to persist amid macroeconomic headwinds, policy and regulatory shifts and global trade uncertainties.

Releasing its results for the third quarter (3Q25) and nine months (9M25) ended September yesterday, the planter, formerly known as Sime Darby Plantation Bhd, smashed the RM2bil mark for its 9M25 net profit as it touched RM2.01bil, representing a 44.2% year-on-year (y-o-y) surge, on a revenue increase of 5.6% to RM15.4bil.

For 3Q25, net profit also climbed 22.1% y-o-y to RM935mil, on a 2.7% growth in turnover to RM5.41bil.

In a statement, SD Guthrie said its 9M25 performance was driven by sustained strong contributions from its upstream segment, whose profit before interest and tax (PBIT) grew by 53% y-o-y, further complemented by promising contributions from the group’s industrial development segment.

Meanwhile, it said higher average realised CPO and palm kernel prices, coupled with productivity improvements in the group’s upstream operations were key to the improved 3Q25 results.

“Encouraging performance from our upstream operations in Papua New Guinea, Solomon Islands and Malaysia contributed to the rise in fresh fruit bunch production,” the group pointed out.

Supporting the 3Q25 performance, the group said SD Guthrie International, its downstream segment, recorded higher margins in its Asia Pacific bulk operations and enjoyed an increased demand of products in the Oceania region, resulting in a PBIT of RM154mil in 3Q25, an 18% y-o-y increase from RM130mil.

It added: “The industrial development business vertical demonstrated promising progress, recording gains in its share of profits from the sale of land to Eco Business Park 7 Sdn Bhd, our tri-partite joint venture with Eco World Development Group Bhd and NS Corp to develop an integrated industrial park on 1,195 acres of land in Bukit Pelandok, Negri Sembilan.

“The gains further contributed to the segment’s RM432mil PBIT in 3Q25,” it said.

From a sequential perspective, SD Guthrie also saw 3Q25 net profit almost double from RM505mil in 2Q25, as revenue rose 4.7% from RM5.17bil, which it primarily attributed to higher profits from its industrial development and downstream segments, which mitigated lower profits from its upstream segment.

The planter reported that finance costs were 27% lower, driven by both lower borrowings and lower average interest rates which declined to 4.4% per annum from 4.8% per annum in the preceding quarter.

SD Guthrie had in 2Q25 announced a dividend of 7.75 sen per share.

Group managing director Datuk Mohamad Helmy Othman Basha, commenting on the group’s results and its top spot achievement in the global SPOTT (Sustainability Policy Transparency Toolkit) palm oil assessment, said it is the group’s fundamental belief that the principles of sustainable development should be embraced and implemented by all businesses.

“SPOTT shines a light on supply chain transparency which enables partners to work together to advance industry standards and to foster value creation.

“At the same time, it is exciting to witness meaningful progress in our new business verticals, particularly the industrial development segment. Whilst this is a relatively new frontier for us, we are committed to establishing a clear and impactful path forward, anchored by the synergistic strengths of our strategic collaborations,” he said.

Separately, SD Guthrie also announced yesterday that Mohamad Helmy will be stepping down from his role as group managing director effective December 31, 2025, to be replaced by Mohd Haris Mohd Arshad, presently his deputy.

Mohamad Helmy will be redesignated as advisor to the board of directors from Jan 1, 2026 until his planned retirement on June 30 of the same year.

SD Guthrie chairman Tan Sri Dr Nik Norzrul Thani Nik Hassan Thani said Mohamad Helmy has led the group through some challenging times in his six and a half years in office, which included the pandemic lockdowns and the ban of the group’s products in the US.

“Mohd Helmy is leaving on a high note with both operational and financial performance of the group moving in the right trajectory,” he added.

Incoming group managing director Mohd Haris joined Sime Darby Bhd in 2014, as the head of global trading and marketing.

Following the demerger of the Sime Darby Group in November 2017, he was then appointed chief operating officer of the then Sime Darby Plantation Bhd’s downstream division.

SD Guthrie’s statement said Mohd Haris had played a pivotal role in the rebranding of the downstream division to Sime Darby Oils in 2019.

In January 2024, Mohd Haris was promoted to group chief operating officer, taking on a wider role that included SD Guthrie’s vast upstream operations.

Read more at https://www.thestar.com.my/business/business-news/2025/11/06/sd-guthries-nine-month-earnings-top-rm2bil-mark