KUALA LUMPUR (July 22): United Plantations Bhd's net profit for the second quarter ended June 30, 2021 (2QFY21) rose 9.87% to RM135.79 million from RM123.59 million, supported by better plantation performance, while contribution from its refinery segment fell.

Quarterly earnings per share rose to 32.74 sen from 29.8 sen, the group’s filing showed.

Revenue in the quarter rose 63.72% to RM481.87 million from RM294.32 million, as both segments saw top line growth, led by the refinery segment.

For the six-month period (6MFY21), United Plantations' net profit rose 2.85% to RM210.61 million from RM204.78 million, again thanks to the plantation segment contribution, while the refinery segment was weighed down by losses in 1Q2FY21.

The plantation segment performance was underpinned by higher crude palm oil (CPO) production and higher CPO and palm kernel (PK) average prices, it said.

Separately, the refinery segment was hit by timing differences of raw materials hedging versus delivery of finished goods.

“[However], the immediate hedging loss recognized upon closing of the earlier hedged raw materials positions will be reversed upon delivery of the finished goods in the next quarters,” it said.

Half-year revenue rose 43.75% to RM881.52 million from RM613.27 million.

On prospects, United Plantations said shortage of foreign workers due to repatriation and impediment in new recruits will be “the biggest risk” for the remainder of this year.

“With the significant uncertainties related to the consequences of the Covid-19 pandemic, it is difficult to predict the results for 2021 as much can still happen.

“However, based on the prices contracted under the company’s forward sales policy and with production having increased due to large areas steadily coming into maturity from our replanted areas in Malaysia, the board of directors expects that the results for the year will be satisfactory,” it added.

Shares of United Plantations settled down 4 sen or 0.29% at RM13.62 today, valuing the group at RM5.67 billion.