FGV rebounds to records net profit of RM20.55m in Q2

by BERNAMA/ pic by TMR FILE

FGV Holdings Bhd recorded a net profit of RM20.55 million in the second quarter ended June 30, 2020 against a net loss of RM52.20 million in the same period a year earlier.

Revenue for the quarter was slightly higher at RM3.29 billion from RM3.28 billion a year earlier.

For the six-month period, the group recorded a wider net loss of RM121.80 million from RM55.57 million, while revenue fell to RM6.08 billion from RM6.56 billion a year earlier.

Weaker earnings and revenue for the six-month period was mainly due to higher losses registered in the plantation sector as a result of lower sales volume but was partially compensated with lower fair value charge of RM133.2 million compared to RM165.3 million in the previous year.

The plantation sector registered a higher loss of RM104.98 million for the financial period ended June 30, 2020 compared to RM14.28 million loss in the previous corresponding financial period.

“This was mainly attributable to the decrease in crude palm oil (CPO) sales volume by 21.7 per cent in tandem with the lower fresh fruit bunches (FFB) production by 13.8 per cent to 1.90 million tonnes,” FGV said in a filing with Bursa Malaysia today.

Moving forward, the group expects a stronger second half for its plantation sector as FFB and CPO production across its operations normalise after a slow start earlier this year.

It said demand for CPO is poised to recover as global markets open up from strict lockdowns in the first half of 2020 while the sugar sector will continue to be challenging and will focus on its turnaround plan, product diversification and export market.

“The board expects the overall business environment to remain uncertain and volatile,” said FGV.

It added that its diversification plans are in motion and one of the new sectors that have been established in the fast-moving consumer goods, which will be operating alongside the group’s other business.

All of FGV’s consumer products will be consolidated under this sector and categorised into two segments, namely food and non-food.