KUALA LUMPUR (Feb 21): Guan Chong Bhd, the world's fourth largest cocoa grinder, reported a 9.51% increase in net profit for its fourth quarter ended Dec 31, 2021 (4QFY21) to RM51.24 million from RM46.79 million in 4QFY20, due to stronger revenue and improved margins.

Revenue rose 6.36% to RM1.09 billion from RM1.02 billion, driven by an increase in sales volume of cocoa products amid the economic reopening and higher consumption during festive season, according to the group in a bourse filing.

Its earnings per share (EPS) for the quarter rose to 4.92 sen from 4.59 sen in 4QFY20.

For the whole of FY21, Guan Chong's net profit dropped 29.96% to RM155.98 million from RM222.71 million in FY20, despite a 6.45% increase in revenue to RM3.92 billion from RM3.68 billion, due to competitive margins committed and higher freight costs registered in FY21. Cumulative EPS were correspondingly lower at 14.97 sen, versus FY20's 21.82 sen.

Guan Chong proposed a final dividend of two sen per share for FY21, subject to shareholders' approval at its forthcoming annual general meeting.

If approved, this will raise Guan Chong's total dividend for FY21 to four sen per share — half a sen higher than its 3.5 sen payout for FY20 — or RM42 million, representing 27% of its FY21 net profit.

On prospects, Guan Chong managing director and chief executive officer Brandon Tay Hoe Lian said the group is seeing good demand for cocoa ingredients, in tandem with the recovering economy as the world heads into the endemic phase of Covid-19.

Tay added that Guan Chong's new Ivory Coast grinding facility, which is expected to start operations in mid-2022, will provide the group with an additional 60,000 tonnes of capacity per year that will help address the higher demand from both its new and existing clients.

"Moving into the year 2022, we are optimistic about capitalising on the recovering economy and delivering a better performance in the new year to come," Tay said.

Guan Chong shares closed nine sen or 3.04% higher at RM3.05 on Monday, giving the cocoa grinder a market capitalisation of RM3.22 billion.