KUALA LUMPUR: Hap Seng Plantations Holdings Bhd’s net profit grew 21% to RM44.97 million in the fourth quarter ended Dec 31, 2016 (4QFY16), from RM37.04 million a year ago, boosted by higher revenue and lower manuring costs.

A filing with Bursa Malaysia showed its quarterly revenue rose 7% to RM128.54 million from RM120.2 million. It proposed a second interim dividend of eight sen per share for FY16, payable on March 23.

The revenue increase was due to higher average selling price realisation of crude palm oil (CPO) and palm kernel, offset somewhat by lower sales volume of both CPO and palm kernel.

For the full year (FY16), Hap Seng Plantations’ net profit surged 27% to RM124.11 million, compared with RM96.45 million in FY15, as revenue climbed 16% to RM503.43 million from RM434.86 million.

Hap Seng Plantations said Malaysia’s palm oil production last year fell 13% to 17.32 million tonnes from 19.96 million tonnes in 2015 due to prolonged effects of the El Nino weather phenomenon, with palm oil inventories closing at 1.77 million tonnes at end-2016, the lowest recorded since 2011.

“This has somewhat supported the current palm oil prices which are expected to remain strong in the first half of the year as [the] global palm oil inventory level is forecast to be low, caused by lower palm oil production, as well as the implementation of mandatory biodiesel programmes in Malaysia and Indonesia,” it added.

However, Hap Seng Plantations warned that prices may be lower in the second half of 2017 as production recovers.

“In spite of the lower price outlook for the second half of 2017, the group is optimistic about achieving satisfactory results for the current FY17,” it added.