Palm oil producer Golden Agri-Resources boosted fourth-quarter earnings on the back of a strong integrated business model and rising crude palm oil market prices.
Net profit rose 137 per cent to US$46 million (S$64.6 million) for the three months to Dec 31, while revenue increased 38 per cent to US$2.14 billion.
Full-year net profit soared from US$10 million to US$400 million, while revenue was up 11 per cent to US$7.21 billion. Palm product output in the fourth quarter rose 7 per cent to 877,077 tonnes.
However, the firm noted that while fruit production has recovered since the middle of last year, it has not compensated for the impact of severe El Nino conditions in 2015.
Earnings were further lifted by deferred tax income from the rise in the tax depreciable value of plantation assets. Golden Agri had revalued some of its plantation assets in Indonesia for future tax benefit, leading to a positive net tax impact of US$62 million in the fourth quarter.
AT A GLANCE
Q4 REVENUE: US$2.14 billion (+38%)
Q4 NET PROFIT: US$46 million (+ 137%)
FINAL DIVIDEND: 0.635 cent (+26%)
The palm and laurics segment has been growing its contribution "as a result of our focus on enhancing margins across the value chain", the group said. A final dividend of 0.635 cent a share was proposed, from 0.502 cent a year earlier.
Chairman and chief executive Franky Widjaja said: "As an integrated player, our performance has been protected by the value coming from our expanded and strengthened downstream business. The palm oil market will remain volatile, but we are confident that the longer-term outlook continues to be promising, as palm oil's productivity leads the vegetable oil industry."
Quarterly earnings per share was 0.36 US cent, from 0.15 US cent in the same period a year earlier. Net asset value per share was 32 US cents as at Dec 31, from 29 US cents as at Dec 31, 2015.
Golden Agri-Resources shares closed flat at 40 cents yesterday.