Second-quarter net profits dropped by 44.7 per cent at palm oil trader Golden Agri-Resources, which blamed the recognition of deferred tax income in the same period last year .
Net profit stood at US$21.9 million (S$29.8 million) for the three months ended June 30, year on year, while revenue ticked up by 0.8 per cent to US$1.76 billion.
But the company noted that, shorn of fair value changes and non-operating items such as tax impact, underlying profit for the quarter was US$53.5 million - a turnaround from a US$6.4 million loss previously.
It also noted that performance has been helped by turnover from a stronger plantations and palm oil mills segment.
This came on the back of higher crude palm oil prices and a recovery in palm production since a severe El Nino weather phenomenon in 2015.
Earnings per share for the quarter was 0.17 US cent a share, down from 0.31 US cent the year before, while net asset value held steady at 32 US cents.
Net profit for the half year slumped 55.5 per cent to US$59.4 million, though revenue grew by 17.5 per cent to US$3.8 billion.
AT A GLANCE
Q2 REVENUE: US$1.76 billion (+0.8%)
Q2 NET PROFIT: US$21.9 million (-44.7%)
Golden Agri-Resources remarked that competing seed oils, fluctuating foreign currency exchange rates and weather conditions could take their toll on the full year's performance.
Still, chairman and chief executive Franky Oesman Widjaja said in a statement that the company "continues to have a positive outlook for full year 2017, supported by our increasing production volume".
Crude palm oil prices, he noted, "have remained stable despite the increasing production output of the industry".
The optimism stems from an anticipated increase in palm oil demand, especially due to consumption growth from Indonesia's turn to cleaner biodiesel.
Golden Agri-Resources shares were flat yesterday at 37.5 cents, before results were announced.