Genting Plantations said expects to see a modest year-on-year growth in FFB production for 2H23, spurred by the favourable age profile and expanded harvesting area in Indonesia.
PETALING JAYA: Genting Plantations Bhd
’s prospect for the second half of 2023 (2H23) will track the performance of its mainstay plantation segment.
The group said the segment is dependent principally on the movements in palm product prices and its fresh fruit bunch (FFB) production.
“In the short run, the group expects palm product prices to remain supported as palm oil production is expected to be impacted by the looming El Nino phenomenon in major palm oil-producing regions.
“Palm product prices have gained strength amidst the geopolitical tension in the Black Sea region which disrupted the supply of sunflower oil, along with drought in North America potentially affecting the production of soya and canola oil,” Genting Plantations said in a statement.
It expects to see a modest year-on-year (y-o-y) growth in FFB production for 2H23, spurred by the favourable age profile and expanded harvesting area in Indonesia.
The company added its property segment will continue to offer products that cater to a broader market segment, taking into consideration the prevailing market sentiment.
In the second quarter ended June 30 (2Q23), Genting Plantations posted a net profit of RM71mil or an earnings per share of 7.91 sen compared with a net profit of RM223.4mil it made in 2Q22.
Revenue for the quarter was 23% y-o-y lower at RM805.9mil due to lower palm product prices, it stated.
For the first six months (1H23), Genting Plantations posted a net profit of RM109.8mil on a revenue of RM1.4bil.
The group’s achieved crude palm oil prices in 2Q23 and 1H23 were similar at RM3,584 per tonne, while palm kernel prices in 2Q23 and 1H23 were RM1,945 per tonne and RM1,963 per tonne, respectively.
Its FFB production in 2Q23 and 1H23 increased y-o-y primarily driven by improved production in Indonesia, attributable to its favourable age profile and expanded harvesting area. This has more than compensated for the marginally lower output in Malaysia as a result of its ongoing replanting activities.
The board of directors has declared an interim single-tier dividend of eight sen per ordinary share, payable on Sept 25.
In comparison, the interim single-tier dividend declared for the corresponding period of 2022 amounted to 15 sen per ordinary share.
