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IndoAgri Q1 profit down 71% on lower palm product output, commodity prices

MAINBOARD-listed agribusiness IndoAgri on Monday posted a 71 per cent fall in net profit to 49.8 billion rupiah (S$4.75 million) for the first quarter ended March 31, 2018, down from 170.6 billion rupiah a year ago on lower palm product output and commodity prices.

This came on the back of a 27 per cent drop in revenue from 4.38 billion rupiah in the previous year to 3.19 billion rupiah this year, attributable to lower sales from its plantation and Edible Oils & Fats (EOF) divisions.

The plantation division saw a 34 per cent decline in revenue, which was due mainly to lower average selling prices and sales volume of crude palm oil (CPO), palm kernel and rubber.

Revenue from the EOF division decreased by 6 per cent on lower edible oils selling prices arising for lower CPO costs.

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Earnings per share for the three months fell by 70.5 per cent to 0.35 Singapore cent from 1.18 Singapore cents. No dividends have been announced for the period.

IndoAgri said that agricultural commodity prices will continue to remain volatile.

"As a diversified and vertically integrated agribusiness with a dominant presence in Indonesia, our operations continue to be supported by a positive domestic economic outlook.

"The ongoing fiscal reforms in Indonesia in the areas of infrastructure and social security, and large domestic consumption with Indonesia being the second-largest consumer of palm oil globally, will continue to support our operations."