Far East Expects To See Reduced FFB Production

KUANTAN, June 25 (Bernama) -- Oil palm based company Far East Holdings Bhdexpects to see an overall reduction in its production of fresh fruitbunches (FFB) this year due to its intensive replanting activities.

Its chairman, Datuk Mohd Ghazali Mohd Khalid, said the company alsoregistered a lower FFB production last year at 257,326 metric tonnes,about four percent lower than the previous year's 267,034 metric tonnesoutput.

"However, the average yield of FFB per hectare was 20.02 metric tonnescompared with 19.74 metric tonnes achieved in the same period of 1999," hesaid in his review of Far East's performance for the financial year endedDec 31 2000 at its annual general meeting here Monday.

He said the company's performance was also significantly affected by thecontinued downtrend in palm oil prices during the year.

"Crude palm oil prices continued to dip further and coupled withcompetitive prices of plantation inputs, the group's revenue and profitshrank considerably."

Mohd Ghazali said that during the year reviewed, the average price ofcrude palm oil was RM999 per metric tonne compared with RM1,460 per metrictonne in 1999.

"The average price of crude palm oil kernel oil also showed significantreduction when it continued to slide from RM1,072 per metric tonne in 1999to about RM687 per metric tonne in 2000," he said.

As a result the group's revenue was reduced to RM41.6 million for theyear, a reduction by 37 percent from the previous year's revenue, he said.

However, Mohd Ghazali said that while the critical factors continued to beunfavourable for the palm oil industry, the group had managed to record acommendable pre-tax profit of RM13.6 million for the year ended Dec 2000.

This was 61 percent lower than the pre-tax profit of RM36.3 millionachieved in the previous year.

Mohd Ghazali said the group would continue to deploy cost savingsstrategies to enhance its performance.

"We believe that through resource optimisation and with the managementadopting total quality organisation approach, especially in plantationoperations, the group has the ability and will be in a position tocontinue to produce relatively strong business results in the futureyears," he said. -- BERNAMA