KUALA LUMPUR (May 19): Following the completion of its reverse takeover (RTO) of Hextar Chemical Ltd in April 2019, agrochemical maker Hextar Global Bhd saw a 54% jump in net profit for the first quarter (1Q) of this financial year.

Its net profit came in at RM9.45 million for the quarter ended March 31, 2020, from RM6.14 million for the corresponding quarter a year ago, its stock exchange filing today showed.

Revenue grew 28% to RM104.57 million from RM81.9 million, mainly due to a bigger contribution from its enlarged agriculture segment and the incorporation of revenue from the consumer products segment following the RTO.

The group also said it managed to increase sales to both local and overseas markets, despite the Covid-19 outbreak, with an increased gross profit margin of 21.9%, up 6.6% from the previous year.

Its consumer products segment also returned to the black, driven by strong revenue growth that was partly boosted by increased demand due to Covid-19.

"Being one of the biggest producers of agrochemical in Malaysia, the group was able to secure sufficient inventories to operate without disruption from the Covid-19 impact," it said.

The group said it will pay a first interim dividend of one sen per share on June 23, which amounts to RM8.06 million in total.

On outlook, Hextar Global said its agriculture segment turned out to be more essentially needed than before, as governments are prioritising food security. Hence, it is confident that the agriculture segment will continue to contribute a sustainable income to the group in 2020.

As for its consumer products segment, it said growth momentum is expected to continue throughout the rest of the year.

Besides that, the group said it has continued with its expansion plan by embarking on 5G technology in the plantation industry, and has set up a new subsidiary, Hextar IOT Sdn Bhd, for the venture. "The group will continue to further explore other potential opportunities besides leveraging on this technology," it added.

At the time of writing, shares in Hextar Global were trading 0.5 sen or 0.7% lower at 71.5 sen, giving it a total market capitalisation of RM576.55 million.