RUBBER group Sri Trang Agro-Industry reported a net profit of 517.3 million baht (S$20 million) for the third quarter ended Sep 30. This is a reversal from the net loss of 410.2 million baht in the corresponding year-ago period.
In a business update on Friday (Nov 8), the group said the net profit was driven by the performance of natural rubber, which saw higher sales volume and average selling prices driven by robust demand.
In particular, the demand for European Union Deforestation Regulation (EUDR) rubber, which is a type of rubber that follows the European deforestation regulation, saw increased demand which contributed to the higher profit margin.
Revenue from products and services amounted to 31.6 billion baht in Q3, increasing by 87.3 per cent year on year (yoy) on the back of higher revenue from natural rubber.
Natural rubber accounted for 79.7 per cent (25.2 billion baht) of total revenue for Q3, growing 106.1 per cent from the same period a year ago. The increase was driven by sales volume that grew 53.1 per cent and average selling price that rose 29.1 per cent yoy, respectively.
Results were mixed on the gloves front. Sales volume was up 26.3 per cent yoy, reflecting a positive trend in demand. But the rapidly appreciating Thai baht, which went up by 5.2 per cent against the US dollar, meant that the average selling price in baht had declined by 3.2 per cent as compared to the previous quarter, said the company.
For the nine months, net profit was 816 million baht, an improvement over a net loss of 12.3 million baht during the same period of the previous year. Revenue hit 81.1 billion baht, a 29.7 per cent increase yoy from the 62.5 million baht in 9M 2023.
Looking ahead, the company said demand for natural rubber has improved compared with the same period in 2023 but noted that prices have been volatile. The proposal to delay the implementation of the EUDR by one year has caused uncertainty to the pricing for its rubber types.
Shares of Sri Trang Agro-Industry closed at S$0.82 on Friday, up 5.8 per cent or S$0.045, before the announcement.
