Haze-linked First Resources, Bumitama post higher profits for Q3

[SINGAPORE] Two palm oil companies linked to the transboundary haze in October reported higher profits for the third quarter ended Sep 30, 2026, in separate business updates published on Friday (Nov 13) morning.

Palm oil producer First Resources posted a 40.1 per cent rise in its underlying net profit to US$122.7 million for Q3, from US$87.5 million in the year-ago period.

The increase was boosted by higher sales of palm oil products and fruit bunches harvested from oil palms, it said.

Sales were up 24.9 per cent at US$578.6 million for the quarter, compared with US$463.3 million in Q3 2025.

Earnings before interest, taxes, depreciation, and amortisation (Ebitda) rose 26.6 per cent to US$207.4 million in Q3 2026, up from US$163.8 million a year ago.

For the nine months ended Sep 30, sales grew 36.5 per cent year on year to US$1.6 billion on the back of higher sales volume.

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A net inventory drawdown of 28,000 tonnes over the 9M period, compared with a build-up of 80,000 tonnes in the corresponding period last year, also supported higher sale volume.

The group’s stronger production output in the first nine months of 2026 was also attributable in part to the full 9M contribution from Austindo Nusantara Jaya, an Indonesian agribusiness company acquired in May 2025.

However, profits were partially offset by foreign currency translation losses from the depreciation of the Indonesian rupiah against the US dollar.

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The group said it expects demand for palm oil to remain supported by Indonesia’s biodiesel programme. In addition, elevated crude oil prices arising from geopolitical tensions in the Middle East are expected to support biodiesel economics and crude palm oil demand.

Performance supported by productivity improvements

Meanwhile, Bumitama reported a 1.9 per cent increase in its net profit to 614.1 billion rupiah (US$34 million) for the quarter ended Sep 30, compared with 602.9 billion rupiah in the previous corresponding period.

For 9M, net profit rose 30.6 per cent to 2.4 trillion rupiah, up from 1.9 trillion rupiah in the year-ago period.

Revenue increased 9.7 per cent to 4.2 trillion rupiah in Q3, up from 3.9 trillion rupiah a year ago. For the 9M period, revenue was up 20 per cent at 16.3 trillion rupiah.

The company said its performance was supported by improvements in productivity in its plantations and mills, particularly during the earlier part of the quarter.

During July 2026, internal production of fresh fruit bunches reached 383,203 tonnes, which accounted for almost 40 per cent of the quarter’s production.

Quarterly production of crude palm oil increased 14 per cent year on year to 368,323 tonnes.

However, exceptionally dry weather conditions in its Kalimantan estates during Q3 placed additional pressure on logistics infrastructure and disrupted shipments. Consequently, Q3 revenue declined compared with that in the second quarter.

The prolonged dry season also heightened the risk of land and forest fires across parts of Kalimantan.

Fires affected certain areas within or adjoining the group’s concessions, including community-managed, conservation and unplanted land, noted the group.

Bumitama said that elevated energy prices and Indonesia’s biodiesel programme coupled with a relatively constrained palm oil supply growth could provide a “supportive backdrop” for palm oil fundamentals heading into 2027.

However, market conditions remain subject to uncertainty. These include changes in global energy prices, supply-and-demand dynamics, and the potential effects of prolonged dry weather on future production, it added.

Both First Resources and Bumitama reiterated their commitment to upholding a zero-burning policy, and cooperating with Indonesian and Singapore authorities in relation to the haze.

Shares of First Resources closed flat at S$2.79 and Bumitama closed flat at S$1.39 on Thursday, before the updates.