PETALING JAYA: Plantation heavyweight IOI Corp Bhd has posted a 36% fall in net profit to RM290.5mil for its first quarter to September due to growing foreign exchange losses.
The second largest plantation company in Malaysia said its financial year 2009 earnings would be lower than a year earlier.
“Overall, the group’s results for the current financial year are expected to be lower than the previous year’s record results but still satisfactory in the light of the current business scenario,” the company told Bursa Malaysia.
An analyst with a bank-backed brokerage said the outlook for IOI Corp was still positive as the supply of edible oils remained tight due to weather conditions.
IOI Corp, one of the most actively traded stocks yesterday, closed at RM3.12, down two sen.
The drop in the first-quarter profit was due to unrealised translation loss on US dollar loans amounting to RM212.2mil, IOI Corp said.
The last time IOI Corp recorded a year-on-year decrease in net profit was in the second quarter of financial year 2006 when it fell 33%.
Revenue for its 2009 first quarter, however, rose to RM4.7bil, up 51.6% from RM3.1bil before, driven by higher plantation earnings.
Plantation earnings rose 43% to RM567.1mil, boosted by significantly higher crude palm oil (CPO) prices. IOI Corp’s average CPO price in the first quarter came in at RM3,391 a tonne, against RM2,473 a tonne last year.
The company said its resource-based manufacturing division reported an increase in profit by 18% or RM22mil despite the inclusion of realised foreign exchange loss of RM63.4mil for its first quarter.
But its property division’s operating profit of RM68.2mil for the first quarter was 38% lower than the previous corresponding period.
“The decrease is due mainly to soft property market conditions experienced in the current quarter and also the lower margins as a result of higher construction costs,” the company said.
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