MARKET DEVELOPMENT
FGV Revenue Up 56 Percent To RM2.7 Billion In Q1 2013
FGV Revenue Up 56 Percent To RM2.7 Billion In Q1 2013
30/05/2013 (Bernama) - Felda Global Ventures Holdings Bhd (FGV), the world's third largest oil palm plantation operator, posted a 55.9 per cent increase in revenue to RM2.68 billion for its first quarter ended March 31, 2013.
Its profit before zakat and taxation for the quarter declined by 22.2 per cent to RM218.51 million from RM280.81 million in the corresponding quarter last year.
Net profit dropped by 25.2 per cent to RM167.06 million from RM223.21 million in the same period previously, FGV said in a statement today.
The company said the decline in profit primarily reflected the effects of lower average crude palm oil (CPO) price realised by the group of RM2,264 per tonne compared with RM3,205 per tonne in 2012.
Malaysian CPO prices have been trading at around RM2,315 per tonne since December 2012 compared with last year's average of RM3,190 per tonne, which was aggravated by reduced palm products purchases as well as high inventory holdings in the edible oil consuming countries such as India and China, it added.
FGV Group President Datuk Sabri Ahmad said in line with other plantation companies, FGV's plantation division had also been adversely impacted.
"However, as an integrated organisation, FGV has the flexibility to utilise cheaper feedstock in the refineries to offset the effect of reduced pricing and at the same time compete with other edible oil producers," he said.
He added that the palm oil industry was expecting a price correction by the middle of the year especially during the upcoming fasting month as demand rises.
Sabri said the decline in profit compared with the previous corresponding quarter was also attributed to other factors including higher fair value changes in the land lease agreement liability of RM54.60 million and provision for impairment which amounted to RM13.66 million related to a joint controlled entity.
Sabri said that the government's decision to launch the B10 biodiesel programme in its effort to stabilise the CPO price was also timely.
"Taking on this opportunity, FGV had entered into an agreement to acquire a biodiesel refinery located in Kuantan, Pahang and expects the plant to be fully operational by mid-2013," he added.
"With our resilient integrated business model and new businesses developed in the recent years as well as strong asset base, we are reasonably confident that we will overcome the difficult environment, and barring any unforeseen circumstances, we are optimistic of the prospects for the rest of the year," added Sabri.
Its profit before zakat and taxation for the quarter declined by 22.2 per cent to RM218.51 million from RM280.81 million in the corresponding quarter last year.
Net profit dropped by 25.2 per cent to RM167.06 million from RM223.21 million in the same period previously, FGV said in a statement today.
The company said the decline in profit primarily reflected the effects of lower average crude palm oil (CPO) price realised by the group of RM2,264 per tonne compared with RM3,205 per tonne in 2012.
Malaysian CPO prices have been trading at around RM2,315 per tonne since December 2012 compared with last year's average of RM3,190 per tonne, which was aggravated by reduced palm products purchases as well as high inventory holdings in the edible oil consuming countries such as India and China, it added.
FGV Group President Datuk Sabri Ahmad said in line with other plantation companies, FGV's plantation division had also been adversely impacted.
"However, as an integrated organisation, FGV has the flexibility to utilise cheaper feedstock in the refineries to offset the effect of reduced pricing and at the same time compete with other edible oil producers," he said.
He added that the palm oil industry was expecting a price correction by the middle of the year especially during the upcoming fasting month as demand rises.
Sabri said the decline in profit compared with the previous corresponding quarter was also attributed to other factors including higher fair value changes in the land lease agreement liability of RM54.60 million and provision for impairment which amounted to RM13.66 million related to a joint controlled entity.
Sabri said that the government's decision to launch the B10 biodiesel programme in its effort to stabilise the CPO price was also timely.
"Taking on this opportunity, FGV had entered into an agreement to acquire a biodiesel refinery located in Kuantan, Pahang and expects the plant to be fully operational by mid-2013," he added.
"With our resilient integrated business model and new businesses developed in the recent years as well as strong asset base, we are reasonably confident that we will overcome the difficult environment, and barring any unforeseen circumstances, we are optimistic of the prospects for the rest of the year," added Sabri.