KUALA LUMPUR (May 28): Malayan Flour Mills Bhd's (MFM) swung back to profit in the first quarter ended March 31, 2021 (1QFY21) amid improvements in both its flour and grains trading, and poultry integration segments.

The group registered a net profit of RM17.66 million compared with a net loss of RM16.79 million in 1QFY20. Revenue rose 8.33% to RM708.77 million from RM654.28 million, it said in a filing to Bursa Malaysia.

The flour and grains trading segment's operating profit grew significantly by 120.5% to RM48.7 million, from RM22.1 million a year ago, primarily due to better margin in the flour business amid lower wheat costs, higher selling price and higher demand.

However, the grains trading business incurred losses in 1QFY21, amid lower demand and higher commodity costs.

Meanwhile, the poultry integration segment's operating loss narrowed to RM21.6 million from an operating loss of RM29.2 million in the same quarter last year.

“In addition, the group's share of profit in equity accounted joint venture in 1QFY21 amounted to RM4.1 million, as opposed to a share of loss of RM1.1 million in 1QFY20. The higher share of profit was mainly attributable to better margin amidst strong demand for flour in 1Q 2021, as well as lower foreign exchange loss as Indonesia Rupiah performed better against the USD in 1QFY21,” MFM added.

On prospects, the group expects its performance in 2021 to remain profitable despite the uncertain economic environment, volatile commodity prices, foreign exchange rates and lingering effects of the Covid-19 pandemic.

MFM' shares closed 1.5 sen or 1.69% lower at 87.5 sen today, giving the group a market capitalisation of RM892 million, after 2.41 million shares were traded.