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Harn Len’s Stellar Finish to FY2025: A Deep Dive into Record Profits and Shareholder Rewards
Harn Len Corporation Bhd has just released its fourth-quarter report for the financial year ending May 31, 2025, and the results are nothing short of impressive. The plantation group not only achieved a significant surge in revenue and profits but also announced a generous dividend, signaling strong confidence in its financial health and future prospects. This report marks a powerful turnaround from the previous year, driven by robust operational performance and a strategic asset disposal. Let’s break down the key figures and what they mean for the company moving forward.
Core Data Highlights: A Stunning Financial Turnaround
Harn Len has turned the tide dramatically, moving from a loss-making position last year to substantial profitability. The full-year results paint a clear picture of this recovery, showcasing strong growth across the board.
Full-Year Performance (FY2025 vs FY2024)
The Group’s full-year revenue soared by 47% to RM283.2 million from RM192.6 million last year. More impressively, it posted a net profit attributable to owners of RM33.4 million, a remarkable reversal from a net loss of RM3.6 million in FY2024.
The final quarter was particularly strong, providing the momentum for this excellent full-year performance. A comparison with the same quarter last year reveals the magnitude of this growth.
Q4 FY2025
Revenue: RM70.9 million
Pre-tax Profit: RM26.6 million
Net Profit (Owners): RM22.5 million
Basic EPS: 3.68 sen
Q4 FY2024
Revenue: RM50.9 million
Pre-tax Profit: RM1.7 million
Net Profit (Owners): RM1.5 million
Basic EPS: 0.27 sen
The incredible 852% surge in profit before tax in the current quarter was significantly boosted by a one-off gain of RM24.3 million from the disposal of an investment property. While this was a major contributor, the underlying operational strength, particularly in the plantation segment, cannot be overlooked.
Breaking Down the Performance: Segment by Segment
Harn Len’s success is primarily rooted in its core plantation business, which benefited from higher production and favourable commodity prices. The company’s recent diversification into aquaculture is still in its nascent stage.
| Business Segment | FY2025 Revenue (RM’000) | FY2025 Segment Result (RM’000) | Key Drivers |
|---|---|---|---|
| Plantation | 279,413 | 36,618 | Higher FFB production, increased CPO & PK sales volume, and better average selling prices (CPO: RM4,125/mt, PK: RM2,668/mt). |
| Property & Others | 3,257 | 18,225 | Profit driven mainly by the one-off gain on disposal of an investment property. |
| Aquaculture | 575 | (1,409) | New segment facing initial operational losses due to prolonged monsoon season delaying shrimp stocking and harvesting. |
The Plantation division remains the group’s engine of growth, contributing 99% of the total revenue. The improved prices for Crude Palm Oil (CPO) and Palm Kernel (PK) compared to the previous year were instrumental in boosting profitability. Meanwhile, the new Aquaculture venture, acquired in January 2025, is finding its footing and is expected to contribute more positively once initial seasonal challenges are overcome.
Navigating the Tides: Risks and Future Outlook
Looking ahead, Harn Len’s prospects appear positive but are not without challenges. The management has outlined a cautious yet optimistic view of the market.
The company expects CPO prices to remain stable, hovering above RM4,000 per metric tonne. This optimism is supported by strong demand from key markets like India and favourable price trends in competing products like soybean oil. However, the company remains vigilant about price volatility, which can be influenced by global geopolitical tensions and fluctuating crude oil prices.
To mitigate these risks, the Group is focused on enhancing operational efficiency and implementing cost-rationalization strategies. The diversification into aquaculture is also a strategic move to create a new income stream and reduce over-reliance on the plantation sector.
Shareholders will also be pleased with the dividend announcement. The board has declared a special single-tier dividend of 3.00 sen per share for FY2025. Including a previous interim dividend, the total dividend for the financial year amounts to an attractive 4.50 sen per share.
Summary and Outlook
Harn Len has delivered a powerful performance in FY2025, marked by a strong operational turnaround, record revenue, and a significant boost from a property sale. The company’s ability to return to profitability and reward shareholders with a handsome dividend is a testament to its strengthened financial position. The strategic expansion into aquaculture, while currently facing initial headwinds, represents a long-term vision for diversified growth.
However, investors should remain mindful of the potential risks:
- Commodity Price Volatility: The plantation segment’s profitability is heavily tied to CPO prices, which are subject to global market fluctuations.
- New Venture Risks: The aquaculture business is in its early stages and faces operational risks such as weather patterns and disease, which could impact future earnings.
- Increased Borrowings: The Group’s total borrowings have increased to RM89.4 million from RM38.3 million, primarily to fund expansion and acquisitions. Managing this debt will be crucial.
- Ongoing Litigation: A subsidiary is involved in an ongoing legal appeal concerning Native Customary Rights land, which, while currently ruled in the company’s favour for a nominal sum, still represents a contingent risk.
Final Thoughts
Harn Len’s FY2025 report showcases a remarkable operational turnaround, bolstered by a significant one-off gain. The strategic move into aquaculture presents a new growth avenue, though it comes with initial challenges. The key for investors will be to monitor if the core plantation business can sustain its momentum and how effectively the new aquaculture venture contributes to the bottom line in the coming years.
What are your thoughts on Harn Len’s diversification into aquaculture? Do you see it as a key growth driver for the future? Share your views in the comments below!
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