MARKET DEVELOPMENT
BW Plantation’s Net Profits Fall 44% in H1 Due To Rising Costs
BW Plantation’s Net Profits Fall 44% in H1 Due To Rising Costs
31/07/2013 (Jakarta Post) - Plantation company PT BW Plantation continued to suffer from rising costs and price volatility as its net profits plunged significantly during the first half of the year.
According to its latest financial report, BW Plantation recorded a 44 percent fall in net profits down to Rp 85.74 billion (US$8.35 million) between January and June.
The publicly listed company actually booked higher sales during that period, growing slightly by 5 percent to Rp 546.35 billion, thanks to an increase in the sales volume of its crude palm oil (CPO) and palm kernels.
Its CPO sales increased by 22 percent to 76,994 tons, while its kernel sales rose 20.8 percent to 11,777 tons in the first half compared to the same period last year.
Its CPO production grew by 10 percent to 66,814 tons and its kernel output by 17 percent to 11,732 tons during the same period year-on-year.
Despite higher sales and higher production volume, the company did not see positive improvement in its average selling price and costs in the first six months of this year.
The CPO price stood at Rp 6,351 per kilogram as of June, down more than 16 percent from a year before.
Its palm kernel price recorded an even worse decline, falling 30 percent to Rp 2,564 per kilogram.
At the same, the company’s costs of goods sold to the market jumped more than half to Rp 307.78 billion and its selling expenses rose more than one-third to Rp 7.09 billion, according to corporate secretary Kelik Irwantono,
“With higher production, we also experienced higher costs to maintain the plantations,” he said during a telephone interview on Monday, explaining the cause of the net profit fall.
In the meantime, BW Plantation is expecting its CPO production volume to increase this year by around 25 percent to 156,000 tons, with more fresh fruit bunches to come.
Kelik said that around 42,000 hectares of its total plantations would have produced fresh fruit bunches by year-end, up from 27,000 hectares last year.
Its total plantation area amounted to 89,469 hectares by June this year, scattered in Central Kalimantan, East Kalimantan and West Kalimantan. Its total planted area reached 62,061 hectares.
BW Plantation is also looking to begin operating a new oil palm mill worth $12 million in East Kalimantan late this year.
The new mill will have a production capacity of 60 tons per hour.
BW Plantation currently operates three mills in Central Kalimantan, with a total production capacity of 135 tons per hour.
The company sets its 2013 revenue target at around Rp 1 trillion, about 6 percent higher from last year, while aiming at booking Rp 200 billion in net profits, around the same level as the year before.
“We are optimistic that we can achieve the targets if the CPO and kernel average selling prices can stay at about the same level until the end of the year,” Kelik said.
As of June this year, the company’s total assets stood at Rp 5.59 trillion, its liabilities at Rp 3.87 trillion and its equities at Rp 1.72 xtrillion.
Shares at BW Plantation, which are traded under the code BWPT at the Indonesia Stock Exchange, closed at Rp 770 apiece on Monday, unchanged from last Friday.
According to its latest financial report, BW Plantation recorded a 44 percent fall in net profits down to Rp 85.74 billion (US$8.35 million) between January and June.
The publicly listed company actually booked higher sales during that period, growing slightly by 5 percent to Rp 546.35 billion, thanks to an increase in the sales volume of its crude palm oil (CPO) and palm kernels.
Its CPO sales increased by 22 percent to 76,994 tons, while its kernel sales rose 20.8 percent to 11,777 tons in the first half compared to the same period last year.
Its CPO production grew by 10 percent to 66,814 tons and its kernel output by 17 percent to 11,732 tons during the same period year-on-year.
Despite higher sales and higher production volume, the company did not see positive improvement in its average selling price and costs in the first six months of this year.
The CPO price stood at Rp 6,351 per kilogram as of June, down more than 16 percent from a year before.
Its palm kernel price recorded an even worse decline, falling 30 percent to Rp 2,564 per kilogram.
At the same, the company’s costs of goods sold to the market jumped more than half to Rp 307.78 billion and its selling expenses rose more than one-third to Rp 7.09 billion, according to corporate secretary Kelik Irwantono,
“With higher production, we also experienced higher costs to maintain the plantations,” he said during a telephone interview on Monday, explaining the cause of the net profit fall.
In the meantime, BW Plantation is expecting its CPO production volume to increase this year by around 25 percent to 156,000 tons, with more fresh fruit bunches to come.
Kelik said that around 42,000 hectares of its total plantations would have produced fresh fruit bunches by year-end, up from 27,000 hectares last year.
Its total plantation area amounted to 89,469 hectares by June this year, scattered in Central Kalimantan, East Kalimantan and West Kalimantan. Its total planted area reached 62,061 hectares.
BW Plantation is also looking to begin operating a new oil palm mill worth $12 million in East Kalimantan late this year.
The new mill will have a production capacity of 60 tons per hour.
BW Plantation currently operates three mills in Central Kalimantan, with a total production capacity of 135 tons per hour.
The company sets its 2013 revenue target at around Rp 1 trillion, about 6 percent higher from last year, while aiming at booking Rp 200 billion in net profits, around the same level as the year before.
“We are optimistic that we can achieve the targets if the CPO and kernel average selling prices can stay at about the same level until the end of the year,” Kelik said.
As of June this year, the company’s total assets stood at Rp 5.59 trillion, its liabilities at Rp 3.87 trillion and its equities at Rp 1.72 xtrillion.
Shares at BW Plantation, which are traded under the code BWPT at the Indonesia Stock Exchange, closed at Rp 770 apiece on Monday, unchanged from last Friday.