In a bourse filing today, the plantation group said the surge in profit was driven by both higher recurring and non-recurring profit before interest and tax (PBIT). This included a non-recurring gain of RM876 million following the disposal of two Indonesian subsidiaries and sale of land in Malaysia.

The disposal of interests in the two Indonesian units resulted in a total gain of RM278 million, while a land sale locally netted RM607 million, along with an impairment charge of RM9 million concerning its rubber plantation in Malaysia.

The group recorded higher recurring PBIT for the upstream segment which increased to RM547 million, an improvement from the previous corresponding quarter profit of RM249 million.

The increase was led by a 14% increase in fresh fruit bunches (FFB) production to 2.45 million tonnes as a result of intensive rehabilitation efforts, as well as a higher oil extraction rate from 20.88% to 21.12%.

However, quarterly revenue fell 11% to RM4.77 billion from RM5.39 billion a year earlier, due to lower average realised crude palm oil and palm kernel prices, which fell by 12% and 11% respectively.

Its net profit for the nine months of FY2023 (9M FY2023) dropped 13.81% to RM1.66 billion from RM1.93 billion, as revenue decreased 14.4% to RM13.15 billion from RM15.36 billion.

As for the group’s prospects, it is optimistic about achieving higher FFB production for the full year, largely driven by improvements in labour productivity and field conditions in its Malaysian operations.

The group also continues to explore further growth in new and existing markets, particularly via its downstream arm, Sime Darby Oils.

The group declared a special interim dividend of 5.7 sen per share for FY2023 on Oct 27.

Sime Darby Plantation is the world’s largest producer of certified sustainable palm oil (CSPO), with a production of 1.887 million tonnes (as of Dec 31, 2022).

Its share price was down by two sen or 0.5% at RM4.34 at today’s close, giving it a market capitalisation of RM30.01 billion.