Palm oil producer Bumitama Agri’s Q1 profit surges to 873b rupiah on higher output, margins

BUMITAMA Agri : P8Z 0% saw its net profit for the first quarter ended Mar 31, 2022 surge to 873 billion rupiah (S$83.4 million) from the previous year’s Q1 profit of 167 billion rupiah.

In a business update on Thursday (May 12), the Indonesian palm oil producer said this came as revenue for the quarter grew 69 per cent to 3.9 trillion rupiah from 2.3 trillion rupiah the previous year, as sales of both the crude palm oil (CPO) and palm kernel (PK) surged on higher average selling prices (ASPs).

Revenue generated from CPO grew 66 per cent to 3.2 trillion rupiah while PK surged 84 per cent to 670.8 billion rupiah, attributed to 76 per cent and 81 per cent year-on-year increases in ASPs, respectively.

Business margins over the quarterly period were also lifted to multi-year highs.

The group’s Ebitda (earnings before interest, taxes, depreciation, and amortisation) and net margins reached 37.8 per cent and 22.4 per cent, respectively, which Bumitama highlighted as figures last seen in 2014.

As such, gross profit jumped 196 per cent to 1.5 trillion rupiah, compared to 507 billion rupiah in Q1 FY2021.

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On the whole, Bumitama observed a pronounced normalisation of production in its estates, supported by favourable weather conditions.

Fresh fruit bunches (FFB) output from the group’s West Kalimantan estates recovered the most by 2 per cent on-year, although Central Kalimantan’s FFB output declined 7 per cent over Q1.

Such output normalisation will continue to take shape in the coming quarters, said the group in its business update, adding that its management is confident of Bumitama’s prospects for the year ahead, as palm oil prices remain elevated to date.

As at end-March 2022, total planted area stood at about 188,000 hectares (ha), comprising nucleus estates covering 132,000 ha and plasma estates covering 56,000 ha.

Shares of Bumitama Agri were trading flat at S$0.74 as at 9.20 am on Thursday, after the news.