MARKET DEVELOPMENT
United Plantations Q1 Net Profit Down on Lower CPO Production
United Plantations Q1 Net Profit Down on Lower CPO Production
14/05/2013 (The Star) - United Plantations Bhd's (UP) net profit slipped to RM64.6mil in the first quarter ended March 31 from RM72.6mil in the same corresponding period a year ago due to lower production and higher production costs of crude palm oil (CPO) and palm kernel. The company's revenue in the first quarter was also lower at RM215.7mil against RM338.6mil.
Earnings per share stood at 31.06 sen per share in the first quarter.
It said prices of most commodities have declined very significantly compared with the highs experienced eight to 12 months ago. “Palm oil is no exception, falling by 35% over the last 12 months due to demand tapering off from the major economies in Europe, North America and also China as well as large parts of South-East Asia. This combined with a larger mature acreage of oil palms in Indonesia and Malaysia resulted in a higher production of crude palm oil sending stocks to levels unseen before.”
“The bearish factors outdo the more bullish signs leading the board of directors to the opinion that the risk of prices declining further outweighs the probability of prices recovering.”
Earnings per share stood at 31.06 sen per share in the first quarter.
It said prices of most commodities have declined very significantly compared with the highs experienced eight to 12 months ago. “Palm oil is no exception, falling by 35% over the last 12 months due to demand tapering off from the major economies in Europe, North America and also China as well as large parts of South-East Asia. This combined with a larger mature acreage of oil palms in Indonesia and Malaysia resulted in a higher production of crude palm oil sending stocks to levels unseen before.”
“The bearish factors outdo the more bullish signs leading the board of directors to the opinion that the risk of prices declining further outweighs the probability of prices recovering.”