Boustead First Quater Profits Up 138%

KUALA LUMPUR , May 20, 2008 – Boustead Holdings Berhad (Boustead) continued its sterling performance into the first quarter of its financial year 2008 with a profit before tax of RM234 million on the back of turnover of RM1.8 billion. This represented a 91% increase in turnover and an outstanding rise in profit before tax compared with the previous year’s first quarter results of RM98 million.

The Group achieved a profit after tax and minority interest of RM152 million marking another significant increase of 140% against the previous year first quarter of RM63 million.

For the period under review, earnings per share was 24 sen (31 March 2007: 11 sen). Net assets per share was RM4.00 (31 December, 2007: RM3.75).

YBhg Tan Sri Dato’ Lodin Wok Kamaruddin, Group Managing Director, Boustead Holdings Berhad, said, “Again we have kicked off this financial year on a resounding note with a strong increase in profit. We are confident and it is highly likely that we will achieve if not surpass our key performance indicators for this financial year. Given this positive start, we have declared a dividend of 10% which is a first for the Group, as we have never declared a dividend before in the first quarter.”

“This time around the Plantation Division has done us proud by being the primary contributor to the Group’s bottomline delivering 45% of the Group’s total profit for this quarter, amounting to RM104 million compared with the previous financial year’s first quarter of RM32 million.

”The Plantation Division’s outstanding performance was due to the increase in crude palm oil prices which averaged RM3,029 per MT for the first quarter registering a 61% increase on a year on year basis compared with the previous year’s first quarter’s average of RM1,882 per MT. Fresh fruit bunches production of 309,895 MT was 5% better.

The Heavy Industries Division was the second largest contributor to the Group with a profit of RM68 million (2007: Loss of RM2 million) due to the consolidation of Boustead Naval Shipyard Sdn Bhd and Boustead Heavy Industries Corporation Berhad which became subsidiaries during the third quarter of 2007. Revenue from the patrol vessel construction projects as well as improved margins and equally important, reduced lower operating costs contributed to the Division’s results.

The Trading Division also demonstrated a marked increment in segmental contribution recording a significant improvement, achieving a profit of RM22.8 million (2007: RM3 million). Key factors included stronger contributions from BH Petrol due to higher sales volume, while stockholding gain and appreciation of the Ringgit which resulted in better margins, further added to the bottomline.

The Property Division recorded a profit of RM20.7 million while the Finance and Investment Division achieved a profit of RM11.9 million. The Manufacturing and Services Division also marked an increase with a profit of RM6.1 million for the quarter under review.

“All in all, our Divisions are doing well and doing so with bigger contributions coupled with a keen eye on the bottomline. The respective management teams have been tasked with ensuring that each Division remains relevant and achieves meaningful contribution to the Group’s growth.”

“Above all, at a time when global markets are experiencing uncertainty and with rising inflation, thinning margins, conglomerates such as Boustead must look within to ensure operational efficiencies and sustainable organic growth,” YBhg Tan Sri Dato’ Lodin concluded.

Since its inception as a modest trading entity for more than 180 years, the Boustead Group has grown by leaps and bounds to comprise more than 80 subsidiary and associate companies, and has substantial interests in various sectors of the Malaysian economy. The Boustead Group’s operations are focused in six key areas; plantation, finance & investment, property, manufacturing and services, trading and heavy industries. As at 31 December 2007, Boustead Holdings Berhad combined paid-up capital is RM315 million, while its shareholders’ funds stands at RM2.5 billion. Market capitalisation currently is in excess of RM3.3 billion.

Forward looking statements
This release may contain certain forward-looking statements with respect to the financial conditions, results of operations and business of the Group and certain plans and objectives of Boustead Holdings Berhad with respect to these items. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future and there are many factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements.

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