FGV Holdings posts 2Q net loss

KUALA LUMPUR: FGV Holdings Bhd recorded a net loss of RM12.90 million in the second financial quarter ended June 30, 2023 (2Q FY2023) versus a net profit of RM374.02 million in the same period last year largely due to lower profit registered in the plantation sector.

The lower profit, however, was partially mitigated by improvement reported in logistics and other sectors, and a lower loss in the sugar sector in the current quarter, the agribusiness and food company said in a filing with Bursa Malaysia today.

Revenue for the quarter fell to RM4.50 billion against RM7.43 billion year-on-year on the back of lower average crude palm oil (CPO) price realised in the current quarter.

The group recorded a loss per share of 0.35 sen for the quarter compared with 10.25 sen year-on-year.

For the first half of the year, FGV Holdings posted a net loss of RM805,000 against a net profit of RM743.26 million. Revenue slipped to RM9.09 billion from RM13.28 billion previously amid ongoing weather uncertainties, which continue to be one of the major factors influencing CPO prices.

Moving forward, FGV Holdings said CPO prices are expected to hold steady in the near term, ranging between RM3,800 per metric tonne and RM4,000 per metric tonne, primarily shaped by adjustments in Indonesia’s CPO export quotas.

Although there was a recent improvement in labour shortages, the group is upskilling new harvesters to improve productivity while remaining cautious about the potential impact of El Nino weather on the upcoming peak season, it added.

“Despite the foreseen challenges in the second half of FY2023, our primary focus is to enhance efficiency through effective operations management to leverage our inherent strengths,” FGV Holdings group chief executive officer Datuk Nazrul Mansor said in a separate statement.

He added that key strategic initiatives are being implemented to mitigate these challenges and to enhance productivity and FGV Holdings anticipates continued improvement for the rest of the year despite the challenges. – BK