KUALA LUMPUR: FGV Holdings Bhd has swung back to profitability with RM150.02 million net profit in the year ended December 31, 2020 (FY20) from a net loss of RM246.17 in 2019.
For the fourth quarter (Q4), FGV's net profit jumped 87.9 per cent to RM134.93 million from RM71.81million a year ago, while revenue increased significantly to RM4 billion from RM3.15 billion in 2019.
Crude palm oil price averaged RM3,059 per tonne during the October-December quarter, higher than the average price of RM2,159 per tonne realised in Q4 2019.
FGV group chief executive officer Datuk Haris Fadzilah Hassan said this was its best performance in five years, despite various challenges faced by the group and palm oil industry in 2020.
FGV said its revenue had increased six per cent to RM14.08 billion in FY20 from RM13.26 billion in the previous year.
Average CPO price realised for FY20 increased 32 per cent to RM2,675 per tonne compared to RM2,021 per tonne in FY19.
Following its positive financial performance and healthy balance sheet, FGV has declared a final dividend of three sen for FY20.
"The increased financial performance was due to improved CPO margin in tandem with higher CPO price realised, better CPO sales volume, improved oil extraction rate (OER) and lower ex-mill production cost," it said.
In the upstream segment, the group said FFB production had increased three per cent to 1.04 million tonnes from 1.01 million tonnes in 2019 due to improved crop recovery and higher mature hectarage.
Haris said FGV was allocating 75,000 tonnes from the group's PKE production as animal feed for local consumption this year. This is equivalent to almost 20 per cent of its total PKE production.
"FGV has also established our distributorship network throughout Peninsular Malaysia to ensure that supply reaches our local farmers effectively," he added.
Haris said to strengthen its consumer products business, FGV may launch six new product variants (SKUs) in the near term.
FGV remained steadfast in its efforts to continue implementing its action plan to address the Roundtable Sustainable Palm Oil (RSPO) Complaints Panel (CP)'s directives since the last time FGV submitted its appeal to the RSPO on April 3 last year, he said.
"RSPO is currently conducting its verification audits to assess FGV's progress in implementing the CP Directives. Six sites had been selected and the RSPO appointed auditor had conducted the verification audit in four selected complexes in Peninsular Malaysia.
"The two remaining audits in Sabah are scheduled to take place in March/April 2021, subject to the lifting of travel restrictions due to the Covid-19 situation," he said.