KUALA LUMPUR (Aug 24): Far East Holdings Bhd’s net profit shrank 91.56% to RM5.92 million in the second quarter ended June 30, 2023 (2QFY2023) from RM70.18 million a year earlier, amid lower average crude palm oil (CPO) and palm kernel (PK) prices as well as lower fresh fruit bunch production.

In its announcement to Bursa Malaysia, the group said its quarterly revenue dropped 59.33% to RM98.57 million from RM242.36 million, as average CPO price declined 40.47% to RM3,893 per tonne from RM6,540 per tonne, while average PK price dropped 42.89% to RM1,988 per tonne from RM3,481 per tonne.

Its share of profit after tax from associates also dropped, by 86% to RM4.61 million.

The group's net profit for the first half of FY2023 fell to RM21.78 million, down 82.91% from RM127.47 million in the corresponding period in FY2022, while revenue shrank 51.49% to RM208.33 million from RM429.43 million.

The group expects weak average selling prices of CPO and PK to continue to impact its performance for the rest of FY2023.

“However, barring unforeseen circumstances, FFB production is forecasted to be stable in 2023. The group’s performance would continue to be challenging due to rising operation costs and higher wages,” the group added.

Far East shares closed unchanged at RM3.59 on Wednesday (Aug 23), giving the group a market capitalisation of RM2.13 billion.