First Resources H2 profit more than doubles to US$128.6m

FIRST Resources EB5 on Friday (Feb 25) reported US$128.6 million in net profit for H2 FY2021, representing a 112.1 per cent year-on-year increase from its restated H2 FY2020 profit of US$60.6 million.

Earnings per share for the half-year stood at US$0.0815, from US$0.0388 in the year-ago period.

Sales grew by 62 per cent to US$619.4 million on the back of higher average selling prices and sales volumes.

For H2 FY2021, gross profit improved by 61.7 per cent to US$288.3 million with a gross profit margin of 46.5 per cent, compared to 46.7 per cent the previous year.

The group noted that higher average selling prices were the main driver of the improved gross profitability despite the flattish margins, which were impacted by increased purchases of palm oil products from third parties.

For the full year, First Resources reported earnings of US$161.1 million or a 61.6 per cent increase from US$99.7 million in FY2020, while sales grew 56.3 per cent on-year to a record US$1 billion.

Fresh fruit bunches (FFB) grew 2.9 per cent year on year with FFB yield coming in at 17.2 tonnes per hectare as compared to 16.4 tonnes per hectare in FY2020.

A final ordinary dividend of S$0.051 per share has been proposed, bringing the dividend for the full year to S$0.0635. The group said this is in line with its dividend policy, which was revised last year to distribute up to 50 per cent of the group's underlying net profit annually, from 30 per cent previously.

Noting record-high palm oil prices in the second half of 2021, chief executive Ciliandra Fangiono sees global vegetable oil supply remaining tight in the near term due to weather influences and continued labour shortages at Malaysian palm oil plantations.

"While the near-term supply tightness has been supportive of palm oil price, its relative pricing against other competing oils and the pace of supply recovery in the rest of the year will exert an influence on the direction of palm oil prices going forward," he said.

Shares of First Resources ended Friday at S$1.84, up 5.1 per cent or S$0.09.

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