Tan Sri Lodin Wok Kamaruddin envisaged that CPO prices would soften as a result of rising palm oil production, which was projected to outpace consumption.
KUALA LUMPUR: Boustead Plantations Bhd
ended the 2017 financial year with a net profit of RM661.96 million compared with RM216.35 million chalked up in the previous year mainly driven by gains realised from land disposal in Penang amounting to RM555 million.
“Stronger profit from operations also contributed to these positive results, on the back of better crop production and higher crude palm oil (CPO) prices,” it said in a statement on Tuesday.
Revenue rose to RM760 million from RM707 million posted in 2016.
For the fourth quarter ended Dec 31, 2017, net profit was lower at RM35.85 million compared with RM41.17 million in the corresponding quarter in 2016, while revenue was higher at RM218.16 million versus RM196.65 million.
Average CPO selling price for 2017 improve nine per cent to RM2,810 per tonne versus RM2,584 per tonne last year while average palm kernel price rose to RM2,505 per tonne.
Fresh fruit bunches production increased seven per cent to 973,513 tonnes, which was primarily due to improved yields post El-Nino. Average oil extraction rate was 21 per cent while kernel extraction rate was 4.3 per cent, marginally lower than last year.
“As a result of improved crop production and higher CPO prices, we saw our profit from operations grow. In tandem with this, we focused on a more effective utilisation of our land bank.
"This enabled the group to unlock greater value which contributed to our bottom line growth.” said its vice-chairman Tan Sri Lodin Wok Kamaruddin in the statement.
He envisaged that CPO prices would soften as a result of rising palm oil production, which was projected to outpace consumption.
Increased soybean acreage in the United States and heightened competition from Indonesia were also expected to pressure the CPO market,” he said, adding that despite these challenges, prospects remained bright for the group.
“In particular, as part of our expansion strategy, our proposed acquisition of 11,600 hectares of plantation land is expected to be completed by the second quarter of 2018.
"We are confident that this will enable us to strengthen our earnings potential over the long-run,” he added. - Bernama
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