KUALA LUMPUR: IOI Corp Bhd is anticipating a satisfactory second half to its 2024 financial year (FY24) amid the current challenges of the global economic environment.

In the second quarter ended Dec 31, 2023, the group posted a net profit of RM335.4mil, which was less than half the net profit of RM712.1mil in the previous corresponding quarter.

The group's earnings per share slumped to 5.41 sen from 11.47 sen in the comparative quarter.

Revenue, meanwhile, was RM2.4bil, down from RM3.3bil in 2QFY23.

The board of directors declared a first interim dividend of 4.5 sen, going ex on March 8, 2024, and payable on March 21, 2024.

Over the two quarters, net profit was RM639.4mil compared to RM879.6mil in 1HFY23, while revenue was RM4.6bil against RM6.97bil in the year-ago period.

The plantations group said it maintained a positive outlook on the operating performance of its plantation segment for the remaining quarters of FY24 with palm fruits production forecast to be moderately higher than in the comparative period last year.

"This is mainly due to labour productivity improvement as well as higher production from the young palm trees in our Indonesian and Peninsular Malaysian plantations," it said in comments accompanying its results filing to the stock exchange.

Meanwhile, the group expects continued low or negative refining margins in its refinery and commodity marketing sub-segment, due largely to the overcapacity of refineries in Indonesia coupled with the raw material price advantage from their country’s CPO export duty policy.

For its oleochemical sub-segment, the outlook remains challenging due to the uncertainties in the global economy and the US-China geopolitical tensions as well as shipping disruptions and freight costs due to the recent attacks in the Red Sea.

The group's specialty fats sub-segment, Bunge Loders Croklaan, is anticipated to be driven by a strong performance in its North American business and the introduction of innovative product application.

"The US Dollar-Ringgit exchange rate which affects the foreign exchange translation gain/loss arising from our USD-denominated borrowings is expected to remain volatile during the first half of 2024," it added.