IOI Corp, Malaysia’s second-biggest palm oil planter by market value, said first-quarter profit dropped 48 per cent on foreign exchange charges and lower earnings from property and manufacturing.
Net income declined to RM258.1 million (US$82 million), or 4 sen a share, in the three months ended September 30, from RM498.13 million, or 7.8 sen, a year earlier, the company said in a statement today. Sales increased 18 per cent to RM4.1 billion on high contributions from the group’s core palm oil business.
“Global economic growth has recently shown signs of slowing down, which will make the current financial year a challenging period for corporations,” IOI said in the statement.
“Nevertheless, the group is optimistic that it will perform satisfactorily.”
IOI fetched an average RM3,149 a metric tonne for its crude palm oil in the quarter, compared with RM2,598 a year ago, it said. Palm futures have since dropped after hitting a 35-month high of RM3,967 a tonne on February 10 amid concern over expected higher output from top producers Indonesia and Malaysia and on global economic woes.
Palm oil may climb to RM4,000 by the end of the first half, the highest level since 2008, amid sustained demand and as production slows, Dorab Mistry, director of Godrej International Ltd said on November 13. Mistry cut his estimate for this year’s palm oil production in Malaysia to 18.8 million tonnes from 19 million tonnes and for Indonesia to 25.2 million tonnes from 25.5 million tonnes.
The group booked a RM271.7 million charge on an unrealised loss for the quarter on foreign currency-denominated borrowings, the Putrajaya-based company said.
IOI’s resource-based manufacturing segment reported a 29 per cent decrease in operating profit to RM33.2 million on lower sales of oleochemicals and reduced margins, the statement said.
Property earnings fell 31 per cent to RM168.2 million, it said. The group generates around 6.6 per cent of its revenue from real estate, according to data compiled by Bloomberg. -- Bloomberg
Net income declined to RM258.1 million (US$82 million), or 4 sen a share, in the three months ended September 30, from RM498.13 million, or 7.8 sen, a year earlier, the company said in a statement today. Sales increased 18 per cent to RM4.1 billion on high contributions from the group’s core palm oil business.
“Global economic growth has recently shown signs of slowing down, which will make the current financial year a challenging period for corporations,” IOI said in the statement.
“Nevertheless, the group is optimistic that it will perform satisfactorily.”
IOI fetched an average RM3,149 a metric tonne for its crude palm oil in the quarter, compared with RM2,598 a year ago, it said. Palm futures have since dropped after hitting a 35-month high of RM3,967 a tonne on February 10 amid concern over expected higher output from top producers Indonesia and Malaysia and on global economic woes.
Palm oil may climb to RM4,000 by the end of the first half, the highest level since 2008, amid sustained demand and as production slows, Dorab Mistry, director of Godrej International Ltd said on November 13. Mistry cut his estimate for this year’s palm oil production in Malaysia to 18.8 million tonnes from 19 million tonnes and for Indonesia to 25.2 million tonnes from 25.5 million tonnes.
The group booked a RM271.7 million charge on an unrealised loss for the quarter on foreign currency-denominated borrowings, the Putrajaya-based company said.
IOI’s resource-based manufacturing segment reported a 29 per cent decrease in operating profit to RM33.2 million on lower sales of oleochemicals and reduced margins, the statement said.
Property earnings fell 31 per cent to RM168.2 million, it said. The group generates around 6.6 per cent of its revenue from real estate, according to data compiled by Bloomberg. -- Bloomberg
