GOLDEN Agri-Resources reported net profit of US$15.3 million for the second half ended Dec 31, 2023, down 96.1 per cent from US$392.4 million in H2 FY2022 mainly due to lower revenue and a decline in share of results of joint ventures.

Earnings per share (EPS) for the period stood at US$0.0012, down from an EPS of US$0.0309 in H2 FY2022.

Its board recommended a lower final dividend of S$0.00613 per share, as opposed to the S$0.00991 final dividend paid out in the same period a year ago.

This came after “careful consideration for rewarding shareholders while maintaining a strong balance sheet ahead of anticipated global challenges”, said Golden Agri on Wednesday (Feb 28).

The proposed dividend will be distributed on May 16 upon approval at the group’s upcoming annual general meeting.

Revenue for the half year fell 18 per cent to US$4.9 billion from US$5.9 billion, led by a decline in contributions from the palm, laurics and others segment, which more than offset higher revenue from the plantations and palm oil mills segment.

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By geographical location, the revenue decline was led by a drop in contributions from Europe, India, the rest of Asia and others.

Share of results of joint ventures, net of tax, fell 79.9 per cent year on year in H2 FY2023 to US$5.7 million from US$28.1 million in the same period the year before.  

Earnings before interest, taxes, depreciation, and amortisation for H2 was down 50.1 per cent to US$508 million, and 46 per cent lower year on year at US$985.6 million for the whole of FY2023.

For the full year, the group reported a net profit of US$197.6 million, representing a 74.7 per cent decline from US$782.1 million in FY2022.

It nonetheless viewed the financial performance for 2023 as “solid”, as it marked a normalisation from record-high crude palm oil (CPO) prices the year before.

Revenue fell 14.7 per cent to US$9.8 billion from US$11.4 billion previously, which the group said was in line with lower CPO prices compared to the previous year.

Chief executive and chairman Franky Widjaja said he expects palm oil supply in 2024 to be “constrained” due to El Nino conditions that brought water deficit in some areas in Q3 2023.

“Combined with low seasonal production in the first half of the year, palm oil is currently trading at a premium to other vegetable oils. Nonetheless, we see sustained demand for palm oil thanks to increased market appreciation for its versatile applications.”

He expects demand for palm oil to remain especially robust from consumption as a food staple, as well as the increasing usage in biodiesel and biomass alternatives.

Shares of Golden Agri : E5H 0% ended Tuesday flat at S$0.275.