NEWS

FGV suffers 23.3m pre-tax loss in third quarter

Bernama

Published
Modified 22 Nov 2016, 8:07 pm

Felda Global Ventures Holdings Bhd (FGV) has managed to trim its pre-tax loss to RM23.23 million for the third quarter (Q3) ended Sept 30, 2016, from a pre-tax loss of RM62.43 million registered in the same quarter of 2015.

The improved performance was due to, among others, the cost saving initiatives undertaken by the group, said the oil palm plantation operator in a filing to Bursa Malaysia today.

It said the group's revenue dropped to RM4.19 billion as compared to RM4.51 billion in the same period last year.

For its nine-month period ended Sept 30, 2016, FGV posted a lower pre-tax profit of RM14.14 million compared to RM200.71 million recorded last year.

It said the decline was largely due to lower crude palm oil production, higher raw sugar costs, lower earnings from downstream segment and losses incurred by a jointly controlled entity.

The group's revenue, meanwhile, improved to RM12.09 billion from RM11.41 billion reported last year.

On prospects, FGV said its performance for the quarter was dragged down by the significant losses suffered by one of the jointly controlled entity due to stock losses discovered in this quarter.

"On this backdrop, we expect our performance to be challenging for the current financial year with another quarter to close the year," it said.

The seasonally lower crop production for the remaining quarter would be potentially compensated by the positive outlook of the crude palm oil (CPO) prices in the near term on the back of full-year tighter supply of palm oil by both Indonesia and Malaysia due to El Nino impact," it said.

However, the upside of the CPO prices would be limited by the edible oil supply and the reduced competitiveness of CPO from the narrower price discounts against soy bean oil.

The slower global growth and the volatility of the currency market arising from the strengthening of the US dollar continue to affect the world economy and tough operating conditions of the Group.

"Amid this background, the board expects the Group to record a loss for the full financial year," it said.

- Bernama

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