Kulim slumps on lower CPO price
Business & Markets 2013
Written by Fatin Rasyiqah Mustaza of theedgemalaysia.com
Friday, 29 November 2013 10:18
KUALA LUMPUR: Kulim (Malaysia) Bhd recorded a 77% slump in net profit for its third quarter ended Sept 30, 2013 (3QFY13), due to lower palm product prices than in the same quarter last year.
During the quarter under review, the plantations group saw a net profit of RM16.42 million from RM71.53 million a year ago. Revenue decreased by 5% to RM682.91 million from RM719.29 million.
For the nine months ended September, net profit was 6% higher at RM473.72 million against RM445.2 million a year ago. Revenue was lower at RM2.19 billion against RM2.32 billion.
Kulim said in its notes to Bursa Malaysia that its local plantation operations achieved an average crude palm oil (CPO) price of RM2,463 per tonne compared with RM3,093 last year. Palm kernels were priced at RM1,234 per tonne compared with RM1,749 in 2012.
The group saw an average CPO price of US$879 (RM2,841) per tonne compared with US$962 a year ago from its operations in Papua New Guinea and the Solomon Islands, through New Britain Palm Oil Ltd.
The group’s revenue from its intrapreneur ventures decreased 138% to RM69.44 million and its shipping business also decreased 28.14% to RM125.05 million.
The group said its performance for the remaining period this year will be significantly influenced by the direction of palm oil prices and crop production trends.
“The plantation division has since taken concrete steps to improve its operational productivity and cost efficiency in order to offset any further weakening in the commodity prices,” it said.
Kulim said despite the challenges in the current financial year, the board expects the group’s performance for the remaining quarter to be satisfactory.
This article first appeared in The Edge Financial Daily, on November 29, 2013.