MKH's plantation yields buffer property drag as Batu Kawan takeover nears completion

KUALA LUMPUR: MKH Bhd reported a 10.6 percent drop in net profits for the third quarter of FY26, reaching RM15.1 million, down from RM16.9 million in the same period last year. This decline was due to difficulties in the property development segment. Revenue for the quarter decreased by four percent to RM221.5 million from RM230.75 million previously.

Earnings per share stood at 2.62 sen, compared to 2.93 sen a year ago. Despite the lower revenue, the company's overall profit before tax (PBT) for Q3 FY26 was higher at RM40 million, up from RM31 million in the same period last year, mainly due to increased sales of crude palm oil at 31,177 metric tons. The decrease in the plantation division's contribution was largely due to a loss before tax from the property development division, resulting from lower new property sales, reduced revenue, and profit recognition from ongoing and newly launched projects.

The plantation segment's improved performance arrives as Batu Kawan Bhd strengthens its control over MKH, with Whitmore Holdings Sdn Bhd now owning 50.9 percent of MKH's shares as of August 10. However, the property development division faced challenges in the near term, recording a year-to-date loss before tax of RM15.5 million, primarily due to delays in the TR2 Residence @ Jalan Tun Razak project and the early stages of projects like Residensi Naluri and Gaya Residency. MKH's future earnings outlook remains strong, supported by RM468.2 million in unbilled sales.