Genting Plantation’s FY22 normalised earnings surged by +6.1%yoy to RM495.2m with higher PBT achieved of RM88.9m. This was primarily fueled by the elevated palm product prices realized despite having a low FFB production and sales volume of refined products.
Nevertheless, EBITDA margin compressed by -3.9 ppts to 31.8% following lower net opex recorded during the period circa RM19.7m due to increase in manuring, upkeeping, and logistic costs. In conclusion, the net earnings fell short of consensus expectations said MIDF making up 92% and 85% of full-year estimates respectively. FFB production. FFB production was muted during the year at 2.0m Mt owing to the disruption of harvesting and logistic activities due to heavy rainfall across Indonesia and Malaysia’s replanting efforts.
Contrarily, average selling prices for CPO and PK during CY22 jumped +19%yoy and +7%yoy to RM4,100/Mt and RM2,784 lifted by stronger prices in the first half of 2022. During the quarter, the plantation segment registered higher profit from RM929.6m to RM947.6m (+18%yoy) owing to the remarkable average CPO & PK prices realized. Meanwhile, its downstream manufacturing segment profit softened by – 8.8%yoy to RM50.9m due to lower sales volume of refined products.
The group declared a Special & Final dividend of 15.0 sen & 4.0 sen per ordinary share making the full-year FY22 dividend (FY21: 30.0 sen) to 34.0 sen/share (about 62% div. payout).
MIDF FY23 and FY24 earnings forecast was lowered to RM425m (-9.0%) and RM306m (-28%yoy) respectively, as it expects weaker performance in subsequent years on account of lower ASP of palm product prices anticipated amidst sticky cost of production (average cost of production for FY22 is around RM2,600/Mt as opposed RM2,200/Mt in subsequent year).
