KUALA LUMPUR, Aug 24 — Malaysia’s FGV Holdings Bhd (FGV) on Monday swung to a profit in the second quarter on higher crude palm oil prices and narrowing losses in the sugar sector, recovering from a sharp first-quarter loss due to the Covid-19 pandemic.
The world’s largest crude palm oil producer recorded a profit of RM20.5 million (US$4.91 million) in the quarter compared with a net loss of RM52.2 million last year.
FGV had reported a net loss of RM142.3 million in the first quarter on lower output and a demand slump due to the coronavirus outbreak.
Crude palm oil prices for the April-June period rose 18 per cent from the year before, the firm said in a bourse filing.
Revenue rose marginally to RM3.29 billion (US$787.46 million), up from RM3.28 billion last year.
“However, overall performance was affected by the coronavirus pandemic which continues to spread globally,” said Haris Fadzilah Hassan, FGV’s group chief executive officer, in a statement.
Improvements to efficiency in its plantation operations helped normalize crude palm oil production despite losing 79,000 tonnes of unharvested palm fruit due to a partial lockdown to contain the virus, he said.
Travel and movement restrictions to stem the spread of the coronavirus outbreak have left Malaysia, the world’s second-largest palm oil producer, grappling with a shortage of workers.
The labor crunch is feared to hurt palm oil production this year by delaying the harvest of perishable fruit.
“We are mindful that the nascent signs of recovery may not be sustainable due to the volatility in global markets and economies,” Haris Fadzilah added.
— Reuters
