KUALA LUMPUR: IOI Corp Bhd's net profit increased 86.5 per cent to RM277.9 million in the first quarter ended September 30, 2020 from RM149 million in the same quarter a year ago.
IOI, in a filing to Bursa Malaysia today, said this was due mainly to higher contribution from the plantation segment.
The segment's Q1 profit was 116 per cent higher at RM273.6 million than RM126.6 million recorded in the same quarter last year.
The group said this was on the back of higher crude palm oil (CPO) and palm kernel (PK) prices as well as higher fresh fruit bunches (FFB) production of 878,701 tonnes versus 801,548 tonnes registered in Q1 of 2019.
Average CPO and PK realised for the quarter was RM2,579 per tonne and RM1,486 per tonne respectively.
IOI's revenue in Q1 was also higher, by 39 per cent at RM2.48 billion versus RM1.78 billion recorded in the same quarter last year.
The company said oil palm crop production was expected to decline until January or February 2021 due to the low production season.
"Although the operations in the plantations are not directly affected by the conditional Movement Control Order's (MCO) restrictions, the freeze on new intake of foreign workers by the government has resulted in labour shortage which has become more severe as months go by.
"Nevertheless, due to the strong palm oil price forecasted until February 2021, we expect good financial performance from our plantation segment at least for Q2 and Q3 of financial year 2021," it said.
IOI expects good Q2 and Q3 financial performance due to the strong palm oil price.
"However, the new wave of Covid-19 infection cases in Malaysia and Europe has made operating conditions difficult and cast some uncertainties on the financial performance of the Group for Q4 of financial year 2021," it said.