FGV Holdings Bhd (FGV) recorded a net loss of RM23.23 million in the second-quarter (Q2) ended June 30, 2018 from a net profit of RM37.26 million in the same period a year ago due to weak contribution from plantation division.
The losses were primarily dragged by lower average crude palm oil (CPO) prices of RM2,477 per metric tonne compared to RM2,916 in 2017.
Revenue for the quarter also declined 18.29 per cent to RM3.44 billion from RM4.21 billion attributed to lower productivity, higher production costs and higher share of loss from joint ventures and associate companies.
The company in a statement said CPO sales volume was 480,738 tonnes, 14.18 per cent higher in this quarter compared to 421,045 tonnes in the previous corresponding quarter.
Fresh fruit bunch (FFB) production was marginally lower at 993,505 tonnes compared to the previous 1.04 million tonnes.
For the first-half (1H) 2018, FGV posted a net loss of RM21.90 million from a net profit of RM38.96 million in the same period a year ago, while revenue plunged 17.47 per cent to RM7.04 billion from RM8.53 billion.
FGV board acknowledged that further steps need to be taken by the management to enhance operational effectiveness and efficiencies in light with the changing market conditions.
“We anticipate a challenging year for the company given the bearish CPO price outlook, operational inefficiencies and unrealised returns from investments,” it said.
FGV said it has embarked on a group transformation programme, which is expected to reverse positively and overcome the challenges faced by the group.-NST