PETALING JAYA: Despite registering higher revenue, IOI Corp Bhd’s net profit fell 60.8% to RM159.7mil for the fourth quarter ended June 30, 2015, from RM407.5mil in the previous corresponding period due mainly to lower contribution from its plantation segment, as well as a net foreign currency translation loss.

During the quarter in review, the plantation conglomerate’s revenue rose 3.9% to RM2.94bil from RM2.83bil. Its earnings per share (EPS) fell to 2.52 sen from 6.42 sen previously.

In a statement, IOI said its plantation profit fell 26% year-on-year (y-o-y) to RM235.8mil during the quarter in review due to the lower crude palm oil (CPO) price realised, which averaged at RM2,197 per tonne, compared with RM2,661 per tonne previously.

The group’s resource-based manufacturing profit, on the other hand, fell 4% y-o-y to RM99.1mil due to lower margins from the refinery sub-segment, moderated by better margins from the specialty oils and fats sub-segment.

During the quarter in review, IOI posted a net foreign currency translation loss of RM76.8mil, compared with a gain of RM83.9mil in the corresponding quarter last year, on foreign currency-denominated borrowings.

IOI has proposed a second interim dividend of 4.5 sen per share, thus bringing the total dividend proposed for the financial year ended June 30, 2015 (FY15), to nine sen per share.

“Although the operating environment in Malaysia and the Asian region has become more challenging, we expect our overall operating performance to be satisfactory,” IOI said in a statement.

It pointed out that the implementation of the B15 Biodiesel programme in Indonesia and the likelihood of severe dry weather in the coming months would help to counter the current weak CPO sentiment caused by soft soybean prices and the expectation of seasonally higher production of oil palm fruits.

“We expect the CPO price to stay mostly flat during the next three months,” IOI said, while adding that it would continue to pursue cost efficiency and higher productivity for its plantation operations and leverage on its sustainability record and the synergy with its downstream operations to extract higher value add for its CPO and palm kernel produce.

In the resource-based manufacturing segment, IOI said it would expect its specialty oils and fats sub-segment to perform well, given the geographical spread of its operations, especially in the United States and Europe. Its oleochemicals sub-segment would also perform satisfactorily with the lower palm kernel raw material cost and higher glycerine price.

However, IOI said the volatility of the dollar-ringgit exchange rate would continue to be reflected in the group’s translation gains/losses, arising from its medium to long-dated US dollar-denominated borrowings.

For the full year, IOI’s net profit was 95% lower at RM168.1mil, compared with RM3.37bil in FY14.

The significant decline in the group’s earnings was mainly attributable to lower contributions from both its plantation and resource-based manufacturing segments, as well as a net foreign currency translation loss.

During the year in review, the group’s net foreign currency translation loss widened to RM735.3mil from RM22mil in the preceding year due to the weaker ringgit.

For financial year 2015, IOI’s EPS stood at 2.64 sen, compared with 52.93 sen in the preceding year.

The group saw its revenue fall 2.4% to RM11.62bil from RM11.91bil previously.