IOI Second-Quarter Net Income Rises 11% on Higher Palm Price
IOI Corp. (IOI), Malaysia’s second-biggest palm oil planter by market value, said second-quarter profit gained 11 percent on higher crude palm oil prices.
Net income advanced to 577.7 million ringgit ($191 million), or 9 sen a share, in the three months ended Dec. 31, from 520.2 million ringgit, or 8 sen, a year earlier, the company said in a statement today. Sales increased 5 percent to 4.17 billion ringgit on higher contributions from the group’s core palm oil business.
IOI fetched an average 3,032 ringgit a metric ton for its crude palm oil in the quarter, compared with 2,800 ringgit a year ago, it said. Palm futures gained 9.3 percent in the quarter ended Dec. 31. The May-delivery contract gained as much as 0.7 percent to 3,272 ringgit a ton on the Malaysia Derivatives Exchange today after reaching an 8-month high of 3,294 ringgit yesterday.
Palm-oil exports from Malaysia, the second-largest producer, may climb as much as 10 percent this year, expanding faster than local output and helping to drive down stockpiles and support prices, Lee Yeow Chor, IOI’s executive director and chairman of the Malaysian Palm Oil Council, said on Feb. 15. Prices may reach 4,000 ringgit a ton by June, Dorab Mistry, a director of Godrej International Ltd., forecast in December.
IOI declined 0.2 percent to 5.33 ringgit at 3:40 p.m. local time compared with the 0.1 drop in the benchmark FTSE Bursa Malaysia KLCI Index.
Fresh Fruit Bunches
“The plantation segment is expected to perform well for the current financial year on the back of strong crude palm oil prices and higher FFB productions,” IOI said.
IOI’s resource-based manufacturing segment reported a 22 percent rise in profit to 124.2 million ringgit on increased margins from oleochemicals and higher sales from specialty fats and refineries, according to the statement.
Property development earnings rose 16 percent to 146.1 million ringgit, it said. The group generates around 5.9 percent of its revenue from real estate including investments, according to data compiled by Bloomberg.
The company declared an interim dividend of 7 sen per ordinary share for the financial year ending June 2012.
To contact the reporter on this story: Ranjeetha Pakiam in Kuala Lumpur at rpakiam@bloomberg.net
To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net
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