Boustead Plantations Bhd lost RM352,000 in its third quarter, a hair below break-even and a long way from the RM95.56 million profit it made in the same quarter of 2021. The loss works out to 0.02 sen per share, against earnings of 4.27 sen a year ago. Falling palm product prices and heavier manuring costs did the damage, the company said in its Nov 22 results.
Revenue for the quarter ended Sept 30, 2022 fell 18.22% to RM240.25 million from RM293.77 million. Fewer fresh fruit bunches (FFB) reached the mills because harvesters were scarce. Profit from operations shrank to RM1.4 million. “The profit from operations of RM1.4 million dropped substantially as compared to RM133.1 million achieved in the corresponding quarter last year,” the company noted.
Fewer hands on the estates
The shortage of harvesters hit hardest in Sabah and Sarawak. FFB output came to 227,335 MT, 14% below the 263,276 MT picked a year earlier. Yield slipped to 3.4 MT per hectare from 3.8 MT.
“Lower production was mainly attributable to lower crops in Sabah and Sarawak as a result of shortage of harvesters,” the group said.
Prices and costs
The average CPO price for the quarter was RM4,089 per metric tonne, against RM4,331 per MT in 3QFY21. Palm kernel dropped to RM2,494 per MT from RM2,541.
Fertiliser was the other drain. Manuring cost jumped to RM21.2 million from RM6.2 million. As CPO prices plunged, Boustead also wrote down the value of its FFB, taking an RM11.9 million loss on the line where a year before it had booked a gain of RM10.1 million.
Nine months still ahead
The year-to-date numbers look much better. Net profit for the nine months to Sept 30 tripled to RM508.02 million from RM156.16 million, and revenue grew 28.92% to RM913.37 million from RM708.49 million. Land sales explain most of the jump: a RM364.1 million gain from disposing of the Kulai Young land and RM3.6 million from a government land acquisition at Telok Sengat Estate.
A third interim dividend of 1.1 sen per share is payable on Dec 22.
Looking ahead, acting chief executive officer Fahmy Ismail said palm oil prices should stay highly volatile through the end of the year because Malaysia and Indonesia are in their high crop season. High production cost from minimum wages, fertiliser and diesel will remain a challenge, he said. Shares closed at 67 sen on Tuesday, down two sen or 2.9%, valuing the company at RM1.49 billion.
Sources
Sources
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