KUALA LUMPUR (Feb 23): Felda Global Ventures Holdings Bhd's (FGV) fourth quarter ended Dec 31, 2017 (4QFY17) net profit declined 31.9% to RM76.57 million, from RM112.46 million a year ago, as the group's non-controlling interests were entitled to higher share of profit after tax for the quarter under review.
Earnings per share (EPS) fell to 2.1 sen, from 3.1 sen in 4QFY16.
In a filing with Bursa Malaysia today, FGV said revenue for 4QFY17 amounted to RM4.28 billion, which was 17% lower than RM5.15 billion in 4QFY16.
For the full FY17, FGV's net profit jumped more than four times to RM143.73 million, from RM31.47 million in FY16, despite revenue declining 1.5% to RM16.97 billion, from RM17.24 billion over the same period.
EPS rose to 3.9 sen, from 0.9 sen previously.
In a statement today, FGV said the improved profitability in FY17 was due to strong performance from the plantation, and logistics and others (LO) sectors.
"The plantation sector registered a significant improvement with a profit of RM554 million from RM234 million in the previous year on the back of higher fresh fruit bunches (FFB) production, better crude palm oil (CPO) sales margins and stronger performance from joint venture companies," FGV group president and chief executive officer Datuk Zakaria Arshad said.
FGV said the LO sector recorded a higher profit of RM45 million compared to RM8 million in the previous year mainly due to higher throughput in the group's bulking business, and increased tonnage carried by the transport operations in tandem with the increase in CPO production volume.
Meanwhile FGV said its sugar division posted a smaller profit for FY17 due to higher international raw sugar price and weakened ringgit.
"We increased our focus on the plantation business last year through our strategic transformation plan and the results have been encouraging. We are confident the momentum will continue this year, supported by sustainable growth in LO sector and improvement by sugar sector," Zakaria said.
Moving forward, FGV said it is expecting to normalise labour shortage by mid-2018, which will improve harvesting efficiency and is expected to increase this year's FFB production by 9% to 4.85 million metric tonne (MT), while reducing CPO production ex-mill cost per MT to RM1,562.
Zakaria said the group will continue to grow its LO sector business capabilities to generate external opportunities, including procuring new liquid and dry tankers and external business opportunities from various infrastructure projects.
"For the sugar sector, we have made progress through effective cost management, capital strengthening and rationalising our operations. In addition, our new sugar refinery in Johor will begin operations in second half of 2018 which will increase our sugar refining capacity for export markets," he said.
"The group's 2017 full year results improved in line with FGV's transformation and growth initiatives during the year. The transformation and growth enhancing efforts will continue into 2018, where the management expects further positive results to be achieved," he added.
At the market break, FGV was trading at RM2.01, down three sen or 1.47%, giving it a market capitalisation of RM7.33 billion.