Far East Holdings quarterly profit dips on higher costs

Palm Oil PlantationMalaysia's Far East Holdings Berhad reported a drop in quarterly net profit due to higher costs

The company's net profit fell 10.3 per cent to about US$6.6mn in the three months ended March 31.

"Lower profit before tax and net profit after tax was due to higher estate expenditure and milling expenditure," the company said in a regulatory filing.

However, the palm oil cultivator saw its revenue rise 18.5 per cent to about US$27.5mn helped by higher fresh fruit bunch production (FFB).

The company said FFB production rose 14 per cent in the period compared with a year earlier.

Palm oil cultivators were been hurt by an El Nino in 2017, which impacted their production capabilities.

However, cultivators expect production to recover as the El Nino effect tapers off.

"Barring any extreme weather abnormalities, the Group expects the full year FFB production to improve from the previous financial year as the El Niño effect tapers off in line with increased FFB output in the oil palm industry," palm oil giant Sime Darby Plantation said in its quarterly report in February.

