Published August 27, 2009

IOI posts 18% lower Q4 profit at RM487m

It blames lower prices and a property writedown in Singapore

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(KUALA LUMPUR) IOI Corp, Malaysia's second-biggest palm-oil producer, said that fiscal fourth-quarter profit fell 18 per cent because of lower prices and a property writedown.

Full-year profit fell 56per cent to RM983.5 million, or 16.62 sen a share.

Net income dropped to RM487.1 million (S$200 million), or 8.21 sen a share, in the three months ended June 30 from RM597.3 million, or 9.91 sen, a year earlier, the company said yesterday in a statement to the Kuala Lumpur stock exchange.

Sales fell 32 per cent to RM3.1 billion.

'If the economy and business conditions show an improvement in year 2010 as is widely expected, the group is optimistic that it will perform better in the new financial year,' the company said in the statement.

IOI has risen 43 per cent this year, compared with a 33 per cent increase in the benchmark FTSE Bursa Malaysia KLCI Index. The stock fell one sen to RM5.09 at the end of trading, after the company announced its earnings during the lunch break.

Full-year profit fell 56 per cent to RM983.5 million, or 16.62 sen a share, from RM2.23 billion, or 36.85 sen a year earlier.

The company had an 'impairment loss' of RM242.8 million on a development property in Singapore. Without the loss, fourth-quarter earnings would have been little changed from a year earlier.



Operating profit from its property business rose 13 per cent on year to RM226.6 million mainly because of increased sales of higher-end developments. The plantation business reported a 50 per cent decline in quarterly operating profit to RM259.3 million, because of lower palm oil prices and fresh fruit production.

IOI got an average price of RM2,455 a tonne in the quarter, down 27 per cent from a year earlier, when prices tracked crude oil to record highs.

'The global economic slowdown, which is affecting Malaysia, has shown signs of stabilising but will continue to make the new financial year a challenging period for business corporations,' IOI said in the statement.