Earnings before interest, taxes, depreciation, and amortisation (EBITDA) rose 38.4% y-o-y to US$53.7 million.
Total sales dipped 6.2% y-o-y to US$140.4 million in the same quarter. The decline in revenue was due to lower third party sales for CPO, and a net inventory build-up of 8,000 tonnes in 1Q20, compared to a drawdown of 17,000 tonnes last year.
Equity attributable to owners of the company fell 19.6% y-o-y to US$839.2 million as at March 31, on foreign currency translation losses arising from the depreciation of the Indonesian rupiah against the US dollar during the quarter.
The company has a net gearing ratio at 0.31 times and cash, US$103.9 million in bank balances, as well as US$330 million of undrawn committed unsecured credit facilities as at March 31.
CPO prices are expected to remain weak in the short to medium term owing to the Covid-19 pandemic. In the longer term, Indonesia’s B30 biodiesel mandate, which is one of the key demand drivers for palm oil, may be impacted by faltering oil prices and lower fuel consumption.
However, First Resources sees a recovery in palm oil demand in the near future as lockdown measures ease globally, owing to it being a staple in dining establishments and food processing industries.
As at 9.10am, First Resources shares are trading flat at $1.30.
