Lang
KUALA LUMPUR – Sarawak Plantation Bhd projects crude palm oil (CPO) prices to maintain their current stability, primarily bolstered by escalating biofuel demand from key producing nations, Indonesia and Malaysia. The plantation conglomerate highlighted that Indonesia's implementation of the B50 biodiesel mandate, alongside Malaysia's ongoing biodiesel initiatives, is expected to underpin CPO price levels. Furthermore, the company noted that potential adverse weather conditions, which could disrupt production, might tighten supply and offer additional upward price momentum.
However, Sarawak Plantation cautioned that global geopolitical tensions, the inherent volatility of energy prices, and broader global economic uncertainties remain critical factors posing risks to the market. Despite these potential headwinds, the group expressed optimism about its financial performance. 'Barring any unforeseen circumstances, and subject to a sustainable CPO price, the group anticipates delivering promising financial results for the current financial year,' the company stated.
The group reported a robust financial performance for the second quarter ended June 30, with net profit surging by 45.3% to RM39.1 million. This translates to earnings per share of 14 sen, a significant increase from RM26.9 million, or 9.63 sen per share, recorded in the same period last year. This stronger performance was attributed mainly to higher sales volumes and improved average selling prices for both CPO and palm kernel (PK). CPO sales volume grew by 3.4%, while PK sales volume saw an even more substantial increase of 11.9%. Concurrently, the realised average selling prices for CPO and PK rose by 10.1% and 7.2%, respectively.
For the first half of the financial year, net profit climbed by 25.6% to RM62.1 million, up from RM49.5 million in the prior year, even as revenue experienced a 5.3% decline to RM252.5 million. In a commitment to its shareholders, Sarawak Plantation declared a dividend of 7.5 sen per share for the fiscal year 2026, totaling approximately RM21 million, which is scheduled for payment on September 29, 2026.
Moving forward, the group reiterated its strategic focus on stringent cost management and enhancing operational efficiency. These efforts are aimed at mitigating the impact of rising costs and various business risks, while simultaneously striving to improve overall production output and productivity.
Source: The Star