IOI Corp Bhd expects consistent FFB output next year as higher production from young palm trees in Indonesia compensates lower production from rapid replanting in Sabah, says group managing director and CEO Datuk Lee Yeow Chor.
Lee said the business has advanced its mechanisation strategy in various field operations to relieve the personnel scarcity situation in the estates.
“Overall, we expect the plantation segment to do strongly in the current financial year due to the expected high CPO price in the first half of FY22.
“The high palm oil price and increased CPO export duty in Indonesia continue to erode Malaysian refinery industry margins, giving Indonesian refiners a cost advantage.
“However, our refining subsegment is likely to perform satisfactorily in the coming financial year,” he said.
It also predicts a better overall financial performance in FY22 than in FY21, driven by a robust plantation segment and an enhanced resource-based manufacturing segment.
The group’s net profit doubled to RM1.39 billion from RM600.9 million in FY19, while yearly sales climbed 44.21 percent to RM11.25 billion from RM7.8 billion in FY19.
Lee noted that the business just launched a five-year plan to convert from a low-cost palm oil producer to a high-value palm-based products manufacturer.
Its five strategic targets are to increase yield, optimise labour, diversify crops, grow non-CPO and oleochemical segments.
“These intriguing developments augur well for the group,” he said.
At 4.30pm, IOI Corp shares were trading two sen higher at RM3.77, worth RM23.7 billion. 985,000 shares were traded.
The stock has down 14.9% since January’s top of RM4.64.
Published by Zack Baharum