KUALA LUMPUR, IOI Corporation Bhd’s net profit fell to RM631.7 million for the financial year ended June 30, 2019 (FY2019 ) from RM3.06 billion in the same period a year ago.
Revenue was lower at RM7.38 billion from RM7.41 billion previously.
In a filing with Bursa Malaysia, the company attributed the weaker profit in the fourth quarter mainly to lower contribution from the plantation segment, mitigated by higher contribution from the resource-based manufacturing segment.
The group said the plantation segment’s profit was 52 per cent lower year-on-year at RM1.01 billion during the quarter under review, due to lower crude palm oil and palm kernel prices realised, as well as lower fresh fruit bunches (FFB) production.
The resource-based manufacturing segment, on the other hand, registered a higher profit of RM553.4 million in the fourth quarter of the 2019 financial year (FY19) from RM384 million in the same period in FY18.
Moving forward, IOI Corp expects the plantation segment’s FFB production to slightly improve in FY2020 with the higher production from the young Indonesian plantings offsetting the temporary loss from the higher replanting rate in its Sabah plantations.
Coupled with the anticipated improvement in crude palm oil price, we expect the plantation segment’s performance to improve in the coming financial year, it said.
For the resource-based manufacturing segment, the company expects the oleochemical sub-segment to continue to perform well in FY2020 due to the moderately low feedstock cost.
Its 30-per cent-owned speciality fats associate company Bunge Loders Croklaan is anticipated to continue to sustain its performance in FY2020 with higher volume in the confectionary and human nutrition categories, coupled with the synergies derived from the integration of the company into Bunge’s edible oils business.
Overall, the group expects its performance for FY2020 to be satisfactory.
Source: BERNAMA (News Agency)