$JTIASA / 4383 (JAYA TIASA HOLDINGS BHD) - Hit by impairment, write offs, and taxes; yet declares a record high dividend as cash flows through.

Let's just get right into it.

1. Gross profit for the qtr stands at RM 45.5mil, with a GPM of roughly 20%.
2. PBT is RM 31mil, with a PBT margin of about 13.8%. This quarter they had to pay RM 15.4mil of taxes. Why? Probably because of the weird way taxation works. If anyone runs their own business, you'd understand. Basically, you'd have to pay what the government thinks you should pay first; and the following year if there's any discrepancies then you'd get refunded or added on.

3. Cash on hand stands at RM 283mil, against short and long term borrowings of RM 57.6mil and RM 136.6mil respectively. 283-57.6-136.6= net cash of roughly RM 88.8mil.

4. The cash flow statement is where things get really interesting. NOCF for FY2024 hits RM 360mil while FCF was RM 241mil this year. If we exclude the acquisition of wealth houses estates and mill and evaluate more on the normal capex, the FCF is about RM 290mil. Out of this, they pared down their debts by RM 153mil, and then declared a total of 6sen dividend this FY (2.5sen in Feb, and 3.5sen in Aug), roughly amounting to RM 59mil.

5. The bottomline profit and the cash flow statements are in quite stark contrast with each other, with one giving rather disappointing results while the other showing very strong numbers. It's clear that the PAT numbers were largely affected by the impairments and PPE written off-- I presume the bulk of this comes from the timber division. Bear in mind that these are non cash items.

6. The management guided for an even stronger oil palm operational performance in 2025, aiming to raise their FFB production to 1.2mil MT, with an FFB yield of 17.8 ton per hectare. This should also help with the mill utilization rates and subsequently the efficiency.

7. It's also worth noting that the management is replanting around ~ 1000 hectares of trees.

Are the results satisfactory to you? In my personal opinion, I think they were OK. The underperformance of the timber division was worse than I was prepared for, but the oil palm division is still carrying the performance.

With a record high dividend declared, I think it's a good sign that the management isn't too tight pursed and is willing to declare out the profits in stages while they pare down their debts. For the full year, the payout ratio increased to about 40% from their dividend policy of at least 20%.

All my sharing here is purely for information only based on my understanding. Look through the numbers in detail, do your own valuations, filter through the noise, and then make a decision you can stand proudly by.