KUALA LUMPUR (Nov 26): IJM Plantations Bhd’s net loss narrowed substantially to RM2.32 million in its second quarter ended Sept 30, 2019 (2QFY20), from losses of RM28.30 million in the year-ago quarter, helped by higher sales volume and favourable foreign exchange positions.

Higher sales volume helped lift the group’s quarterly revenue by 23.4% to RM172.86 million, from RM140.09 million in 2QFY19, its exchange filing today showed.

During the quarter, IJM Plantations’ overall fresh fruit bunches (FFB) production improved as a result of the recovery of crop production in the home operations by 42.3%.

Additionally, the rupiah strengthened against the Japanese yen, whilst weakening marginally against the US dollar, which resulted in a slight net foreign exchange gain on the foreign currency denominated borrowings, as compared to the significant net foreign exchange losses of RM22.66 million in 2QFY19, it said.

This brings IJM Plantations’ first-half (1HFY20) net loss to RM7.10 million, significantly lower than its cumulative net loss of RM47.87 million in 1HFY19. Revenue, however, fell 5.4% to RM305.93 million.

On prospects, IJM Plantations said it expects a better crop production from both its home and Indonesian operations for the second half of the financial year.

“Notwithstanding the group continuing to face cost pressures arising mainly from wage increases, and the impact of the volatility of foreign exchange rates, particularly that of the rupiah against the US dollar and Japanese yen, the continuation of the prevailing commodity prices are expected to contribute to an improved performance for the financial year,” it added.

IJM Plantations’ stock price dropped two sen to close at RM1.78 today, giving it market capitalisation of RM1.57 billion. The counter has gained some 30% since August.