First Resources sales heighten by 89.2% to $424.8m for Q3
This was driven by the group's higher average selling prices of palm oil.
First Resources Limited delivered an 89.2% spurt in sales to approximately $424.8m (US$314.2m) for the third quarter (Q3) ended 30 September.
Earnings before interest, taxes, depreciation, and amortization (EBITDA) and underlying net profit up by 52.4% and 44.9% to $147.1m (US$108.8m) and $71.39m (US$52.8m), respectively. For the year-to-date nine months ended 30 September, the group caught up on its weaker performance in the first half of the year to turn in EBITDA and underlying net profit improvements of 14.6% and 5.6%, respectively.
The marked improvement in topline performance was driven by the higher average selling prices and stronger sales volume achieved by the group. A net inventory drawdown of 48,000 tonnes in 3Q2021 also contributed, compared to a net build-up of 5,000 tonnes in Q3 2020.
According to CEO Cillandra Fangiono, "Demand for palm oil has been fuelled by India's reduced import duties to contain rising domestic vegetable oil prices. In addition, China's power supply issues hampered soybean crushing activities and drove substitution demand for palm oil. The supply of palm oil, on the other hand, has been impeded by labour shortages in Malaysia. As a result, palm oil prices were propelled to historical highs recently."
Fangiono added price movements in energy and other vegetable oils will continue to influence the direction of palm oil prices going forward.