Sime Darby Plantation Posts Fourth Quarter Profit and Announces Resumption of Production | Investment News

KUALA LUMPUR (Reuters) – Malaysia’s Sime Darby Plantation Berhad reported higher fourth-quarter net profit on Friday, fueled by higher palm oil prices, and said it expected a resumption of production in the second half of this year.

Profit for the October-December period rose to 468 million ringgit ($112 million) from 149 million ringgit a year earlier, while revenue soared 53% to 5.55 billion ringgit.

Malaysian plantations have suffered a severe labor shortage compounded by pandemic-induced border closures, which have reduced production and pushed benchmark crude palm oil prices to record highs.

Crude palm oil prices are expected to remain high through the first half of 2022 amid supply constraints, said Sime Darby, the world’s largest oil palm planter by land holdings, in a statement. exchange file.

But it expects production to increase in the second half, in line with the peak harvest season and as the government seeks to free up recruitment of migrant workers, the company said.

“Although the threat of COVID-19 persists, the group anticipates that with better control measures and responses, the return to normalcy in the world will accelerate, along with a corresponding increase in demand,” a- he declared.

The company expects a satisfactory performance for the 2022 financial year, he added.

Mechanization, automation and digitization of its operations will be a top priority this year, said Sime Darby, as the group seeks to reduce its reliance on manual labor.

The company, whose products have been banned by US authorities on forced labor charges, said it looked forward to completing an independent assessment of the labor operation soon.

This week, the company said it would set aside about $20 million to compensate migrant workers who paid recruitment fees to get jobs, a practice that often leads to debt bondage.

(Reporting by Rozanna Latiff; Editing by Clarence Fernandez)

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