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IOI Corp’s Q1 Net Profit Up 87% to RM278mil
17/11/2020The Star

Total FFB production for the first quarter of FY21 was 878,701 tonnes compared with 801,548 tonnes in the same quarter last year. (File pic shows IOI Plantation).


PETALING JAYA: IOI Corp Bhd has posted a 87% year-on-year (y-o-y) increase in net profit to RM277.9mil for the first quarter ended Sept 30.

During the quarter under review, the conglomerate’s revenue rose 39.5% y-o-y to RM2.5bil.

In a filing with Bursa Malaysia, IOI Corp said the higher earnings for the quarter were mainly due to higher contribution from the plantation segment, offset by lower contribution from the resource-based manufacturing segment.

Profit for the plantation segment during the quarter doubled on the back of higher crude palm oil (CPO) and palm kernel (PK) prices realised as well as higher fresh fruit bunches (FFB) production.

Total FFB production for the first quarter of FY21 was 878,701 tonnes compared with 801,548 tonnes in the same quarter last year.Additionally, the average CPO and PK prices realised for the quarter were RM2,579 per tonne and RM1,486 per tonne, respectively compared with RM2,014 per tonne and RM1,126 per tonne recorded in the same quarter last year.

IOI Corp said its financial performance, for the second and third quarters of financial year (FY) ending June 30,2021, is expected to be good due to the strong palm oil price forecast until February 2021.

“CPO price is expected to remain high – more than RM3,000 a tonne until February 2021, due to low palm oil inventory and seasonal low crop production until early next year, although its narrowing price discount against other competing vegetable oils and the coming winter in the northern Hemisphere will dampen its demand.

“For our plantation segment, oil palm crop production is expected to decline until January or February 2021 due to the low production season, ” it said.

However, the group noted that the new wave of Covid-19 infection cases in Malaysia and Europe has made operating conditions difficult and cast some uncertainties on its financial performance for the fourth quarter of FY21.

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