Plantation earnings lift Ta Ann as timber stays in the red

Ta Ann Holdings Bhd's plantation operations drove the group's success in the second quarter of fiscal year 2026 (2QFY26), with higher crude palm oil (CPO) prices and production bolstering results despite a continued loss-making quarter for its timber business. Revenue rose 15.9 percent year-on-year to RM501.44 million, while pre-tax profit attributable to shareholders climbed 19.4 percent to RM64.78 million.

For the first six months of the year, revenue increased 8.6 percent year-on-year to RM912.21 million, with net profit attributable to shareholders climbing 19.4 percent to RM114.51 million. The research firm MBSB Investment Bank Bhd credited the strong performance to its oil palm segment, which saw a 14.4 percent year-on-year increase in revenue to RM440.8 million and a 11.9 percent rise in pre-tax profit to RM89.3 million.

However, the timber division remained in the red, with a 29.7 percent year-on-year rise in revenue to RM59.9 million, but a pre-tax loss of RM4.2 million, up from a RM700,000 loss a year earlier. The timber division's losses were attributed to higher production costs and unfavorable currency translation, with log and plywood prices declining.

Despite the setback, analysts from PublicInvest Research anticipate stronger performance from Ta Ann's plantation segment in the second half of the fiscal year 2026, particularly due to higher FFB production. They have raised their earnings forecasts for the year 2026 to 2028 by 14 to 16 percent, with a higher assumption for CPO prices and expected FFB yields.