Rising palm oil output a boon for TSH Resources
24.08.2018 (The Star Online) - PETALING JAYA: Rising palm oil output at TSH Resources Bhd
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helped the company mitigate the impact of lower average crude palm oil (CPO) prices during the second quarter ended June 30.
The Sabah-based company saw a 25% growth in fresh fruit bunch (FFB) production to 220,483 tonnes as compared to the corresponding quarter last year.
The average selling price of CPO dropped to RM2,283 per tonne in the second quarter, compared with RM2,656 per tonne in the same quarter last year.
“FFB production for the first half of the year increased to 401,723 tonnes, from 324,903 tonnes in the first half of 2017,” it said in a statement.
The company said FFB production is targeted to reach 900,000 tonnes in 2018, based on the growth trend for the first half of the year.
“TSH is set to achieve a significant milestone next year by producing more than one million tonnes of FFB,” it added.
This is on the back of a better age profile of its trees, with about 60% of TSH’s oil palm plantations being young trees and growing in maturity profile.
“Improving FFB production will enhance FFB yield per hectare.
“Coupled with existing cost-controls, they will serve to lower unit cost of production, going forward,” it added.
However, the decline in CPO prices had resulted in a lower net profit for TSH during the quarter under review, which stood at RM4.1mil, down from RM25.3mil in the same quarter last year.
TSH registered a core pre-tax profit of RM31.2mil for the second quarter on the back of a revenue of RM232.9mil.
Core pre-tax profit was derived after adjusting non-cash and an unrealised exchange translation gain or loss.
Foreign exchange loss amounted to RM13.1mil.