Malayan Flour Mills reports 13% decline in Q1 profit, allocates US$45 M Capex for FY2025
To bolster its operations, Malayan Flour Mills has earmarked US$ 45.5 million in capital expenditure for the financial year ending December 31, 2025.
MALAYSIA – Malayan Flour Mills Bhd (KL:MFLOUR) has reported a 13% year-on-year decline in net profit for the first quarter ending March 31, 2025, with earnings falling to RM33.09 million (approximately USD 7.05 million) from RM37.9 million in the same period last year.
This downturn was attributed to escalating direct costs outpacing revenue growth, despite a 6.3% increase in revenue to RM799.29 million (US$ 170.2 million), driven by higher sales volumes amid lower product prices.
The company’s share of profit from joint ventures also saw a reduction during the quarter. Looking ahead, Malayan Flour Mills anticipates continued volatility in commodity prices, particularly wheat and grain, due to ongoing macroeconomic and geopolitical uncertainties. The company plans to adjust selling prices and diversify supply sources to mitigate these challenges.
In a strategic move to bolster its operations, Malayan Flour Mills has earmarked RM215 million (US$ 45.5 million) in capital expenditure for the financial year ending December 31, 2025.
Of this, RM160 million (US$ 33.9 million) is allocated to the poultry integration segment, focusing on expanding and upgrading farming infrastructure, including the construction of parent farms and hatcheries. This investment will be jointly funded by Malayan Flour Mills and its partner, Tyson Foods, in a 51:49 ratio.
Additionally, RM55 million (US$ 11.6 million) is designated for the flour and grain trading segment to expand capacity and improve efficiency across key markets in Malaysia and Vietnam.
This includes RM20 million (US$ 4.2 million) for automation at flour mills in Lumut and Pasir Gudang, and RM34 million (US$ 7.2 million) to scale up operations in Vietnam.
Despite the challenges, Malayan Flour Mills remains optimistic about its profitability for the year ending December 31, 2025.
The company did not declare a dividend for the quarter, consistent with its practice of announcing dividends in February and August. Shares of Malayan Flour Mills remained unchanged at 52 sen, valuing the group at RM644.36 million (US$ 137.2 million) ahead of the results announcement.
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