By Chester Tay
Sime Darby Plantation Bhd. incurred a net loss for the fourth quarter due to lower recurring income from both its upstream and downstream operations.
The plantation group on Friday reported a net loss of 45.0 million ringgit ($10.7 million), compared with net profit of MYR172.0 million in the same period a year earlier.
Fourth-quarter revenue grew 3.3% compared with a year earlier to MYR3.38 billion.
Net profit for 2019 was MYR122.0 million, down 83%, while revenue declined 8.9% to MYR12.06 billion.
It said its upstream operations, which is involved with plantation estates and mills, posted a loss because of unrealised losses on the fair value of its commodity hedges, lower fresh fruit bunch production and lower palm kernel prices.
Its downstream operations, which is involved in the refining and sale of palm oil, posted lower profit because of unrealised losses on the fair value of commodity contracts incurred in its refinery in Europe and weaker contribution from businesses in Africa.
Sime Darby Plantation expects palm product prices to recover in 2020 due to a slowdown in crop production but said the recovery may be limited by concerns over global economic growth arising from the coronavirus epidemic.
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