Sime Darby Plantation Berhad registered a net profit of RM812 million for the second quarter which is 30% and RM1.53 billion respectively for the second quarter (2Q FY2022) and six-month period (1H FY2022) of the financial year ending 31 December 2022.
The plantation giant added that buoyant crude palm oil (CPO) and palm kernel (PK) prices continued to support the Group’s stronger year-on-year performance, although its fresh fruit bunch production was impacted by prolonged labour shortage experienced in its Malaysian operations. In the second quarter, average realised CPO and PK prices increased by 44% and 40% YoY respectively to RM5,213 per metric tonne (MT) and RM3,339 per MT.
Meanwhile, the Group’s downstream segment, Sime Darby Oils, registered a profit before interest and tax (PBIT) of RM243 million in 2Q FY2022, a 66% increase compared to RM146 million in 2Q FY2021. The higher profits were mainly attributable to better margins recorded by its Asia Pacific operations which mitigated the lower margins in its European operations as well as the overall lower sales volume achieved.
With the gradual moderation of CPO prices, palm oil has now become more competitive for destination markets, prompting an increase in demand as buyers replenish inventories. The Group expects CPO prices to remain firm at least until the end of 2022. Unfortunately, the delay in the intake of new legal migrant workers continues to disrupt the Group’s harvesting and related activities in its Malaysian operations. This is expected to affect the Group’s overall FFB production, which is anticipated to be lower compared to FY2021.
Barring any unforeseen circumstances, the Group expects its performance for the financial year ending 31 December 2022 to be satisfactory.
The Group is pleased to declare an interim dividend of 10.00 sen per share for FY2022 up from 7.90 sen per share in FY2021.
