Higher PBIT driven by favourable CPO prices, increased production and improved Downstream performance
Kuala Lumpur, 20 May 2021 – Sime Darby Plantation Berhad (SD Plantation) posted a net profit of RM562 million for 1QFY2021, an improvement of 20% as compared to the previous corresponding quarter.
The Group’s Upstream performance improved to a profit before interest and tax (PBIT) of RM543 million (1QFY2020: RM288 million) on the back of sustained higher crude palm oil (CPO) and palm kernel (PK) prices as well as increased Fresh Fruit Bunch (FFB) production. In the same period, the Group’s Downstream operations, Sime Darby Oils, recorded a 20% increase in PBIT totalling RM107 million, primarily attributable to improved performance in the Asia Pacific region.
|Revenue (RM mil)||3,673|
|PBIT (RM mil)||788|
|Net Profit (RM mil)||562|
|CPO Price Realised (RM/ MT)||3,185|
|FFB Production (MT mil)||2.21|
|Oil Extraction Rate (OER) (%)||21.35|
Chairman, Tan Sri Dato’ Seri Haji Megat Najmuddin bin Datuk Seri Dr Haji Megat Khas said,
“Whilst the sustained high CPO price has certainly been a boon for the industry, I am also encouraged by our operational performance despite the challenges presented by the COVID-19 pandemic. With this strong showing in the first quarter, we are on-track to achieve our financial targets for the rest of FY2021.
“With the current spike in infection cases in certain parts of the world, including Malaysia, we are cognisant of the continuing risks and threats from the pandemic. The Group will remain vigilant in safeguarding our operations and employees, even as the current global roll out of vaccines progresses.”
Group Managing Director, Mohamad Helmy Othman Basha said,
“We saw an improvement in the results of Sime Darby Oils in the Asia Pacific, which benefited from the market price uptrend. However, demand has yet to fully recover from the impact of COVID-19.
”The Group is working with several parties to address the withhold release order that was imposed by the US Customs and Border Protection at the end of 2020. The Group had appointed a third-party assessor to undertake a comprehensive review of all its Malaysian operations. This exercise is expected to be completed in June.
“We are committed to protecting the rights and safety of our workforce regardless of race, nationality or gender. As such, we are focused on ensuring safe working and living conditions for all our employees.”
OUTLOOK FOR REMAINING FY2021:
CPO price in the first quarter was driven primarily by record high prices of substitute oils and is expected to soften in the second half of 2021 as production increases. On the operational front, the Group anticipates improved production this year whilst sustaining its efforts to increase efficiency and productivity through digitalisation, automation and mechanisation. Barring any unforeseen circumstances, SD Plantation expects its performance for the financial year ending 31 December 2021 to be promising.