KUALA LUMPUR: FGV Holdings Bhd's net profit surged to RM338.82 million in the second quarter (Q2) ended June 30, 2021 from RM20.55 million recorded in the same quarter last year.
In a statement today, the plantation company said this was contributed by the plantation, sugar and logistic businesses.
FGV's revenue for the quarter increased 42.1 per cent to RM4.68 billion from RM3.29 billion.
"Despite the ongoing challenges of the pandemic, as well as the lagging effect of dry weather, I am pleased to report that FGV posted strong operating profit," FGV group chief executive officer Mohd Nazrul Izam Mansor said.
"We remained resilient in our efforts in these unprecedented times, which has translated into the significant improvement of our financial results for this quarter."
FGV said the plantation sector registered a higher profit of RM421.63 million than the RM105.58 million loss in the previous corresponding period.
"This was mainly due to higher average crude palm oil (CPO) price of RM3,268 per tonne against RM2,453 per tonne previously, despite a lower sales volume of 18.9 per cent.
"The performance of the sector was also boosted by the fair value land lease agreement (LLA) gain of RM36.60 million against RM133.23 million in the previous year," it said.
FGV said the LLA gain for the current year was attributed mainly to the revision in the yield assumptions used in arriving at the LLA liability.
However, fresh fruit bunches (FFB) production dropped 5.3 per cent from 1.90 million tonnes to 1.8 million tonnes.
FGV said the ongoing Covid-19 pandemic, new Delta variant and imposition of the Movement Control Order (MCO) 3.0 would continue to affect Malaysia's palm oil industry.
In curbing the impact of Covid-19 especially at its plantations, FGV is expediting its vaccination programme for all workers as part of its mitigation effort in managing the risk of infections at its operating locations.
"We are currently at the final stage of acquiring the vaccines and shall commence the vaccination programme by the first week of September 2021," said Mohd Nazrul.
On August 16, one of FGV's core sectors, FGV Integrated Farming Sdn Bhd (FGVIF), entered into a Memorandum of Collaboration with Felcra Bhd and Baladna Food Industries, Qatar's largest locally-owned food and dairy producer, to carry out a comprehensive feasibility and technical study on an opportunity to potentially co-invest in an integrated dairy farm business in Chuping, Perlis.
It said the potential initial areas of collaboration included doubling the current production of Malaysian fresh milk within two years, and creating a farm for 10,000 milking cows with an annual production of 100 million litres of milk per year.
"Other potential areas include utilising Malaysian agricultural land to produce largely the required animal feed for the dairy farm, as well as using the joint venture farm as a hub that supports small rural farms in developing small cattle fatting farms and animal feed farms by 2024, among others," it said.