KUALA LUMPUR (May 30): Diversified conglomerate PPB Group Bhd (KL:PPB) said on Thursday its first quarter net profit fell 11% from a year earlier as losses at its cinema operations widened and revenue fell following sale of Indonesian flour operations.

Net profit for the three months ended March 31, 2024 (1QFY2024) was RM337.17 million compared to RM377.54 million over the same period a year ago, PPB said in an exchange filing. Revenue for 1QFY2024 fell 15% year-on-year to RM1.29 billion from RM1.52 billion.

“For the remainder of 2024, we expect intense competition to continue in the flour and feed market, and possible price volatility in the grains market,” said PPB, whose grains-and-agribusiness segment reported a 74% surge in profit.

The company flagged potential disruptions in global grains supply due to ongoing risks associated with uncertain weather conditions in major grains-growing countries.

No dividend was declared for the quarter.

PPB announced the sale of its 51%-owned indirect subsidiary PT Pundi Kencana for 290.7 billion rupiah (RM87.5 million) cash in a related-party transaction which was completed in September 2023.

The consumer products division — which houses its distribution, bakery, and processed food businesses — will expand its product range and market reach amid challenges from cautious consumers and rising cost of living, PPB said. The division reported a profit of RM3 million versus RM7 million in the first quarter of 2023.

Meanwhile, its film exhibition and distribution segment would remain “very challenging” in 2024 after recording a wider loss of RM15 million in 1QFY2024 amid fallout from the Hollywood strikes.

The industrial action would affect supply of movies in the medium term even as it ended in the final quarter of 2023, PPB flagged. The impact, however, could be partially cushioned by local and regional releases, as well as contribution from events and food-and-beverage businesses, PPB said.

PPB’s property business, meanwhile, is hosting several development projects at various stages of planning though improving mall performance will be the key driver for the business that reported profit of RM1.6 million in 1QFY2024.

Wilmar International Ltd, an associate company based in Singapore that contributed RM266 million in FY2024, will continue to contribute “substantially to the overall profitability”, said PPB.

Shares of PPB slipped 0.4% to close at RM14.74 on Thursday ahead of the results announcement. The company, largely controlled by Malaysia’s richest man Robert Kuok, is valued at nearly RM21 billion on Bursa Malaysia.