SINGAPORE - Indonesian palm oil producer Bumitama Agri's second-quarter net profit more than halved, amid a continued weakness in palm oil prices and a fall in sales volume.
Net profit sank 67.9 per cent to 124.6 billion rupiah (S$12.1 million) for the three months ended June 30, from 388 billion rupiah a year ago, the mainboard-listed company announced on Wednesday morning (Aug 14) before the market opened.
Earnings per share came in at 71 rupiah for the quarter, down from 222 rupiah in the year-ago period.
An interim one-tier tax-exempt cash dividend of 0.38 Singapore cent was declared for the current financial period, down from the 0.75 cent a year ago, to be paid on Sept 17.
Revenue fell by almost a quarter (24.3 per cent) year on year to 1.8 trillion rupiah for Q2, mainly due to a decrease in the average selling prices of crude palm oil and palm kernel by 15.4 per cent and 38.8 per cent respectively.
Low prices of vegetable oils and the high stock level of palm oil in the industry had kept palm oil prices low, Bumitama noted in its financial statements.
"We do not foresee any changes in palm oil prices in the near futures unless there are changes affecting supply and demand dynamics," the group said.
Bumitama had likewise reported a drop in selling prices when it released its first-quarter financial results in May.
Revenue contribution from crude palm oil declined 22.6 per cent for the second quarter, while revenue from palm kernel shrank by 36.9 per cent.
The volume of crude palm oil sold also fell, by 8.5 per cent to 244,109 tonnes, although sales volume for palm kernel grew 3.1 per cent to 51,241 tonnes.
For the half year to June 30, net profit tumbled 62 per cent to 235.2 billion rupiah, while revenue declined 18.8 per cent to 3.5 trillion rupiah.
Shares of Bumitama Agri were trading flat at $0.60 as at 9.51am on Wednesday, after the results were released.