KUALA LUMPUR: Ancom Nylex Bhd (ANB) posted a net profit of RM16.4 million on the back of RM483.9 million in revenue for the third quarter (Q3) of the financial year ended February 28, 2023 (FY23).
This represented a bottom-line growth of 8.0 per cent year-on-year (YoY) from the RM15.1 million achieved in Q3 FY22.
For the nine months (9M) of FY23, ANB registered revenue of RM1.57 billion compared to RM1.45 billion in the same period last year.
This translates to an improvement of 8.1 per cent YoY.
With top-line growth, ANB's 9M net profit jumped 57.1 per cent YoY to RM56.9 million versus RM36.3 million a year ago.
In terms of its segmental performance, the company's agricultural chemicals (agrichem) delivered revenue of RM440.0 million for 9M FY23 from RM347.4 million in the previous year, a YoY growth of 26.7 per cent.
The agrichem segment continues to be ANB's main profit driver.
Managing director and group chief executive officer Lee Cheun Wei said the agrichem segment continued to be the key growth driver in the current financial year.
The healthy order flow from our Agrichem business pushed our nine-month bottom line to a record high of RM56.9 million.
"Meanwhile, installing new reactors at our Shah Alam plant is still in progress, which would expand our capacity for the monosodium methanearsonate (MSMA) related products.
"This is critical for us to seize the opportunity arising from the growing demand due to the ban of a close substitute, paraquat, in Thailand.
"The yield for one of our new active ingredients (AI) has been very encouraging, and we target to start production at our new facility in Klang by the end of 2023," he said in a statement.
Separately, ANB's wholly owned subsidiary, Ancom Crop Care Sdn Bhd, has entered into a share sale agreement (SSA) with HJ Unkel (M) Sdn Bhd, Chong Sau Kin and Ye Suping to acquire 70 per cent equity interest in HJ Unkel Chemicals Sdn Bhd for RM9.0 million.
The acquisition comes with a profit guarantee of RM2.5 million in net profit for HJU Chemicals' financial years ending May 31, 2024, and May 31, 2025, respectively.
This is a synergistic move as HJU Chemicals could be supplying surfactant chemicals to its agrichem division for the production of AI.
Therefore, by insourcing the procurement, ANB could potentially enhance its profitability, especially considering the rising need of the agrichem division on the back of trending demand for its existing and new AI products.