UPDATE 2-Malaysia Sime profit beats forecast; hikes capex

* Q4 net profit 984 mln rgt vs 1.02 bln rgt yr-ago

* Full-year net profit beat consensus estimates

* Hikes capex to 7 bln rgt to boost plantation ops

* Says committed to divest non-core businesses

* Shares up slightly before earnings release (Adds detail, quotes)

By Soo Ai Peng and Royce Cheah

KUALA LUMPUR, Aug 27 (Reuters) - Malaysian conglomerate Sime Darby (SIME.KL), reported on Thursday better-than-expected quarterly profits and said it would more than triple capital expenditure for fiscal 2010 to boost plantation operations.

Sime Darby, the result of a merger between three palm oil companies, said it had no immediate plan to spin off its plantation business for a separate listing on the local bourse.

"We took the trouble to merge the companies for synergistic value, we are now in stage two, and stage two is to expand," said CEO Ahmad Zubir.

The company is planning a 4.5 billion ringgit ($1.27 billion) fundraising in fiscal 2010 using Islamic instruments, Zubir told a news conference when releasing the company's quarterly earnings.

Capex for FY2010 will be 7 billion ringgit, compared with 2 billion in 2009, he said.

The world's biggest oil palm planter by land bank posted April-June net profit of 984 million ringgit, down from 1.02 billion a year ago.

Full-year net profit fell to 2.28 billion ringgit from 3.5 billion a year ago but came in above the 1.98 billion ringgit consensus estimate from Thomson Reuters I/B/E/S.

The full-year net profit exceeded the company's target by 20 percent, it said.

State-controlled Sime Darby said the performance was due to its conglomerate business model but it remains committed to divesting its non-core businesses and focusing on its core sectors.

"I am pleased with the performance of the Group especially since we are emerging from a very challenging business environment in a relatively strong position," said Zubir.

"Our performance is a further testament of our conglomerate business model," he said in a statement.

Plantations contributed the bulk of the company's fiscal 2009 net profit with the rest coming from automotive, property, utilities, energy and heavy equipment.

For a graphic on Sime Darby's earnings click: here

"All our businesses must continue to perform above the required hurdle rates to justify their presence in the group," said Zubir.

"We will continue to restructure our portfolio relentlessly in response to changes in the Group's strategic business environment," he said.

Singapore-listed Wilmar (WLIL.SI), a dominant player in the downstream sector that benefits when palm oil prices fall, posted a 23 percent rise in April-June net profit. [ID:nSIN366289]

Some analysts have said Sime Darby needs a big overhaul, including possibly listing its prized plantations business and selling its underperforming motor unit, to boost valuations and compete better with fast-growing rivals. [ID:nKLR531564]

Sime Darby shares have gained 58 percent so far this year, outpacing a 34 percent rise in the wider market .KLSE but lagging its rivals in Singapore and Indonesia. The stock ended 0.12 percent higher on Thursday at 8.24 ringgit a share. (Reporting by Soo Ai Peng and Royce Cheah; Editing by Anshuman Daga)