Latest Quarterly Results

Quarterly Report For The Financial Period Ended 31 March 2018

Financials Archive

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Unaudited Condensed Statement Of Consolidated Comprehensive Income

Unaudited Condensed Consolidated Statement Of Financial Position

Performance Review

For the third quarter of 2018, the Group achieved an unaudited pre-tax profit of RM57.8 million as compared with RM42.4 million for the corresponding quarter last year. The profit was lower by 82% mainly due to lower prices of palm products.

FFB production for the quarter increased by 8% to 226,323 MT. The increase in crop was largely attributed to recovery in yields post El-Nino. OER averaged at 20.5% as compared with 20.7% for the corresponding quarter last year. The average KER of 4.5% was marginally higher than the rate for corresponding quarter in 2017..

CPO achieved an average selling price of RM2,491 per MT, down by RM675 per MT or 21% from RM3,166 per MT from corresponding quarter last year whilst PK's average price of RM2,188 per MT, was down by RM1,016 per MT or 32%.

Peninsular Malaysia Region

Peninsular Malaysia region achieved a segment profit of RM10.7 million as compared with RM22.9 million for the three-month period ended 31 March 2017. The decline in profit of RM12.2 million or 53% was mainly attributed to significantly lower selling prices of palm products. The region's FFB crop of 92.906 MT was up from 2017 by 3%.

Sabah region

Sabah region achieved a segment profit of RM3.3 million, down by 82% from RM18.6 million for the corresponding quarter last year. Although FFB production of 104,652 MT reflected a quarter-on-quarter surplus of 24%, the adverse impact of lower selling prices and higher operating expenditure led to the decline in profit.

Sarawak region

Sarawak region registered a segment profit of RM5.2 million as compared with RM5.0 million quarter-on-quarter, The lost was attributed to lower palm product prices and crop. The region produced 28,765 MT of FFB, down 17% from the corresponding quarter last year.

Prospects for Rest of the Year

The Group's profitability is influenced by crop production and CPO prices. For the current financial year, the proposed sale of 138.89 hectares of Malakoff Estate, upon completion in the third quarter of 2018, will contribute positively to the Group's earnings.

FFB yields are improving in Peninsular Malaysia and Sabah regions while labour shortage coupled with the difficult ground conditions in hampering operations in Sarawak. The recent acquisition of approximately 11,579 hectares of plantation land in the district of Labuk and Sugut, Sabah is expected to boost the Group's production.

The global vegetable oil production for 2018 in forecast to exceed consumption and this likely to suppress demand for palm oil and in turn, push up inventory levels. Although the price outlook for CPO is not encouraging. European Union's removal of anti-dumping duty for biodiesel from Indonesia is positive news for the sector coupled with the likelihood of higher tariffs on US soyabean by China may lend support to palm oil as a potential edible oil subsitute. In addition, the possibility of crude mineral oil prices remaining above USD70 per barrel could encourage more biodiesel production in Indonesia using palm oil as feedstock.

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