Plantation firm Felda Global Ventures reports $12.7m net profit in Q3
KUALA LUMPUR: Malaysia's Felda Global Ventures (FGV), the world's No. 3 palm plantation operator, returned to profitability on increased production and predicted a further rise in output next year.
The company reported a net profit of RM38.8 million (S$12.7m) for the quarter ended September, compared with a loss of RM73.6 million a year earlier, it said yesterday.
FGV said its quarterly production of palm fresh fruit bunches (FFB) grew 18 per cent year-on-year, with its plantation operations also boosted by robust palm oil prices.
The profit came even as revenue dipped to RM4.15 billion from RM4.19 billion ringgit.
FGV was hit by a management crisis in June when chief executive Zakaria Arshad was forced to step aside during an investigation, initiated by the firm's chairman at the time, into transactions at a subsidiary. But the chairman later resigned and Mr Zakaria, who denied any wrongdoing, was reinstated in the middle of last month.
FGV is targeting FFB production of 4.3 million tonnes by year-end, with next year's output seen at 4.86 million tonnes, Mr Zakaria said.
The company does not expect its production to be hurt by the La Nina weather event, which brings rains across Asia.
Mr Zakaria expects crude palm oil, currently around RM2,600 a tonne, to trade between RM2,500 and RM2,700 for the first half of next year.
Prices will drop next year as "a lot of competition will come from soyoil, and also on recovery of output," he said.
FGV's shares rose as much as 2.8 per cent following the quarterly results. - REUTERS