KUALA LUMPUR (Feb 22): Hap Seng Plantations Bhd’s net profit for the fourth quarter ended Dec 31, 2022 (4QFY2022) dropped 79.99% to RM18.87 million or 2.36 sen per share, from RM94.31 million or 11.79 sen per share a year ago.

Earnings in 4QFY2022 were dragged down by lower revenue; increase in production costs due to higher fertiliser, diesel costs and increase in minimum wage; as well as loss from fair value adjustments of biological assets of RM13.2 million versus a gain of RM19.5 million in the preceding year’s corresponding quarter.

The group’s quarterly revenue declined by 26.32% to RM143.55 million from RM194.83 million, mainly due to lower average selling price of all palm products and lower sales volume of crude palm oil.

Nonetheless, Hap Seng Plantations declared a second interim dividend of seven sen per share, with an ex-date of March 8, payable on March 22.

Net profit for the full financial year ended Dec 31, 2022 (FY2022) decreased 6.12% to RM210.31 million from RM224.02 million, although revenue grew 21.42% to RM814.55 million from RM670.85 million, amid higher average selling prices of all palm products.

Earnings per share in FY2022 fell to 26.30 sen from 28.01 sen in FY2021, the group’s bourse filing showed on Wednesday (Feb 22).

On prospects, the group said it will continue to put concerted efforts to improve fresh fruit bunch yield, oil extraction rates and overall cost efficiencies to mitigate rising production costs.

“Based on the foregoing, the group expects its results for the financial year ending Dec 31, 2023 (FY2023) to be influenced by movements in commodities prices, rising production costs and uncertainties in the global economies,” it added.

Hap Seng Plantation’s share price was five sen or 2.34% lower at RM2.09 at Wednesday’s market close, valuing the group at RM1.67 billion.