KUALA LUMPUR (June 29): Johor-based oil palm planter Kim Loong Resources Bhd's earnings were crimped by lower fresh fruit bunches (FFB) production and lower oil extraction rate which caused its net profit to fall 16% to RM12.41 million in the first quarter ended April 30, 2016 (1QFY17), from RM14.78 million in the same period last year.
Revenue however, rose 9.1% to RM177.7 million, from RM162.88 million, due to higher selling prices for its palm oil milling operations, its bourse filing today showed.
Kim Loong said its FFB production for the current quarter was 52,500 metric tonne (MT), which was 18% lower than the 64,200 MT achieved in the same quarter last year.
Kim Loong said the significant drop in production was likely caused by the El Nino phenomenon.
For the financial year ending Jan 31, 2017 (FY17), Kim Loong foresees an increase in FFB production from newly-matured areas.
But in view of the potential effects caused by the El Nino phenomenon in the first quarter, it expects FFB production to be flat, while crude palm oil (CPO) production could be lower, compared with FY16.
Subject to fluctuations in the ringgit and the commodities market, it expects CPO price to move towards higher levels, considering a potential drop in CPO supply caused by El Nino.
As such, it expects its FY17's performance to be satisfactory.
Shares of Kim Loong fell 5 sen or 1.47% to RM3.35 today, giving it a market capitalisation of RM1.04 billion.