IOI has also taken a number of steps to improve sustainability practices, including obtaining third-party verification on its progress towards implementing sustainable policies.
KUALA LUMPUR: IOI Corporation Bhd
reported a 32% decline in profit from continuing operations to RM240mil in the third quarter ended March 31, 2019, from RM354mil a year ago due to weaker plantation profit caused by weaker crude palm oil (CPO) and palm kernel (PK) prices.
It said on Tuesday its pre-tax profit (PBT) fell by 15% to RM365.40mil from RM430.70mil due mainly to lower net foreign currency translation gain on foreign currency denominated borrowings and deposits.
The underlying PBT of RM285.6mil for Q3 FY19 was 7% higher than the underlying PBT of RM267.5mil for Q3 FY2018, due mainly to higher contribution from the resource-based manufacturing segment, offset by lower contribution from the plantation segment.
However, IOI Corp said this higher PBT was after stripping out the total net foreign currency translation gain of RM57.2mil (RM170.4mil in Q3 FY18) on foreign currency denominated borrowings and deposits as well as fair value gain on derivative financial instruments from the resource-based manufacturing segment of RM22.6mil (Q3 FY18 – loss of RM7.2mil),
Hence, the bottomline or net profit fell by 88% to RM240mil from RM2.07bil a year ago when there was profit from discontinued operations (RM55.30mil), gain on disposal of discountinued operations (RM1.19bil), gain on remeasurement of a share of associate (RM299mil) and recognition of fair value of put-call options (RM162.5mil).
As for the plantation segment, the profit fell by 44% to RM132.6mi from RM238.3mil a year ago due to lower CPO and PK prices realised. Average CPO and PK prices realised for Q3 FY19 were RM1,971 a tonne (Q3 FY18 – RM2,471) and RM1,312 (Q3 FY18 – RM2,201) respectively.
IOI Corp's resource-based manufacturing segment profit for Q3 FY19 rose by 206% to RM196.6mil from RM64.1mil.
Excluding the fair value gain/loss on derivative financial instruments, the underlying profit for resource-based manufacturing segment rose by 144% to RM174mil versus RM71.3mil a year ago.
“The higher profit is due mainly to higher sales volume and margins from refining sub-segment as well as share of associate results from Bunge Loders Croklaan Group B.V. (taken up as discontinued operations in Q3 FY2018 prior to the completion of divestment of Loders).
At the net profit level, net profit fell by 88% to RM240mil from RM2.07bil a year ago when the group recognised a disposal gain of RM1.66bil arising from the divestment of 70% equity interest in Loders.
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