First Resources Q2 profit slides 52.8% on weaker palm oil prices

SINGAPORE - Weaker palm oil prices took a toll on First Resources' second-quarter earnings, as the palm oil producer on Wednesday posted a 52.8 per cent drop in net profit to US$17 million for the three months ended June 30, down from US$35.9 million for the year-ago period.

Earnings per share (EPS) for the quarter stood at 1.07 US cents, from 2.27 US cents previously.

This comes as sales fell 20.8 per cent to US$143.4 million, mainly due to lower average selling prices, First Resources said.

The board has declared an interim cash dividend of 0.625 cent for the current financial year, to be paid out on Sept 12, as compared to a dividend of 1.25 cents for the year-ago period.

For the six months ended June 30, net profit dived 54 per cent to US$29.3 million, as sales dipped 7.4 per cent to US$293 million from last year. This translated to an EPS of 1.85 US cents for the half-year period, versus an EPS of 4.02 US cents in the preceding year.

Ciliandra Fangiono, CEO of First Resources, said: "Palm oil prices have been weighed down by uncertainties in the macro environment brought on by the ongoing US-China trade tensions, as well as pressures from other competing vegetable oils.

"However, CPO (crude palm oil) price affordability and Indonesia's biodiesel mandate is expected to be supportive of demand. Looking ahead, the group expects production to pick up seasonally in the second half of the year."

As at 9.49am on Wednesday, shares in First Resources were trading flat at $1.54.

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