PETALING JAYA: Sime Darby Plantation Bhd (SDP) today reported a 7.7% year-on-year (y-o-y) increase in net profit to RM2.68 billion for the financial year ended Dec 31, 2022 (FY22).
The oil palm plantation group also reported a RM610 million net profit for the last quarter of the year (4Q22), up 13.6% from the RM537 million recorded in the same quarter a year earlier.
The board has declared a final dividend of 6.04 sen per share to be paid on May 15, with April 27 ex-date. Together with the interim dividend of 10 sen per share paid on Nov 18, 2022, this translates to a 16.04 sen per share dividend for FY22.
SDP attributed the better results largely to the improved performance of its downstream operations Sime Darby Oils (SDO), which attained a profit before interest and tax of RM859 million in FY22, which was 61% higher than the previous year.
In a statement issued to the media today, SDP described the fresh fruit bunches (FFB) production in Malaysia for the year as challenging. However, it said, the setback was compensated by higher production from its Indonesia, Papua New Guinea and the Solomon Islands operations.
Nonetheless, it said, the 10% decline in FFB production for the year was mitigated by the higher average realised crude palm oil (CPO) price of 20% the year before.
It expects the arrival of a full complement of workers by the end of June to boost production.
SDP said that in addition to the contributions from SDO, the group’s income was also boosted by non-recurring profits of RM291 million from the disposal of land assets as well as an “earn out” settlement for the disposal of a subsidiary in Liberia.
Looking ahead, the group expects CPO prices to remain at the current levels in 1Q23 due to strong demand and considerable price advantage compared with alternative oils, among other factors.
Group managing director Helmy Othman Basha said the group was tested for three years by the pandemic, movement controls and acute labour shortage, and a ban by the US Customs and Border Protection.
“A new drive to mechanise, automate and digitalise has delivered promising results,” he said.
SDP chairman Megat Najmuddin Megat Khas said the group is now well-positioned to deliver even greater value to shareholders while upholding its commitment to sustainable development.
In a separate filing with Bursa Malaysia, SDP announced that Employees Provident Fund (EPF) CEO Amir Hamzah Azizan has been appointed to its board of directors as non-independent non-executive director.
As of Feb 8, EPF owned 879.06 million shares in SDP, giving it a 12.71% direct stake in the company. Apart from that it has a 1.05% indirect stake of 103 million shares.
SDP’s share price closed at RM4.35 today, unchanged from yesterday, with a market capitalisation of RM30.08 billion.