IOI Corp's plantation in Johor
KUALA LUMPUR: IOI Corporation Bhd
's earnings rose 18% to RM743mil in the financial year ended June 30, 2017 from RM629.70mil in FY17 due mainly to higher contribution from the plantation segment.
The oil palm heavyweight announced on Monday its revenue rose 20% to RM14.127bil from RM11.739bil a year ago.
IOI Corp's profit before tax (PBT) rose 13% to RM1.087bil from RM965.80mil a year ago. It also announced a dividend of five sen a share.
Excluding the net foreign currency translation loss of RM298.8mil (FY2016 – loss of RM318.5mil) and fair value loss on derivative financial instruments from the resource-based manufacturing segment of RM70.3mil (FY2016 – gain of RM120.9mil), the underlying PBT of RM1.456bil for FY2017 was up 25% versus RM1.163bil for FY2016.
“The higher underlying profit before tax was due mainly to higher contribution from the plantation segment which is offset by lower contribution from the resource-based manufacturing segment,” it said.
IOI Corp said plantation profit rose 46% to RM1.230bil from RM842.2mil due mainly to higher crude palm oil (CPO) and palm kernel (PK) prices realised. Average CPO and PK prices realised for FY2017 were RM2,766 a tonne (FY2016 – RM2,249) and RM2,691 a tonne (FY2016 – RM1,740) respectively.
However, the resource-based manufacturing profit fell 47% to RM318.5mil from RM606.4mil due mainly to fair value loss on derivative financial instruments of RM70.3mill recognised in FY17 as opposed to fair value gain of RM120.9mil in FY2016.
“Excluding the fair value loss/gain on derivative financial instruments, the underlying profit for resource-based manufacturing of RM388.8mil for FY2017 is 20% lower than RM485.5mil reported for FY2016. The lower underlying profit is due mainly to lower margins from the refining sub-segment,” it said.
In the fourth quarter, its earnings were RM322.10mil compared with net loss of RM59.60mil a year ago. PBT was RM377.2mil versus loss before taxation of RM24.5mil.
IOI Corp said this was due mainly to net foreign currency translation gain on foreign currency denominated borrowings and lower fair value loss on derivative financial instruments from the resource-based manufacturing segment.
“Excluding the net foreign currency translation gain of RM112mil (Q4 FY2016 – loss of RM124.7mil) and fair value loss on derivative financial instruments from the resource-based manufacturing segment of RM44.6mil (Q4 FY2016 – loss of RM121.9mil), the underlying PBT of RM309.8mil for Q4 FY17 is 39% higher than the underlying PBT of RM222.1 million for Q4 FY2016. The higher underlying PBT is due mainly to higher contribution from all the segments,” it said.
When compared with the third quarter ended March 31, 2017, PBT was lower at RM377.2mil compared with RM392mil in Q3.
IOI Corp said excluding the net foreign currency translation gain of RM112mil (Q3 FY2017 – gain of RM91.2 million) and fair value loss on derivative financial instruments from the resource-based manufacturing segment of RM44.6mil (Q3 FY2017 – gain of RM54.5mil), the underlying PBT of RM309.8mil for Q4 FY2017 is 26% higher than the underlying PBT of RM246.3mil for Q3, FY2017, due mainly to higher contribution from all segments,” it said.
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