UK-listed palm oil processor New Britain Palm Oil has reported a loss for the first half of the year due to severe weather conditions and lower prices for its products.
In the six months to the end of June, NBPO made a net loss of US$56.3m, compared to earnings of $72m in the prior year period. The company blamed the decline on unforeseen negative weather events impacting global yields and lower average selling prices for its crude palm oil and palm kernel oil.
Operating profit in the period fell to $28.2m from $71.7m a year earlier, while sales slid 15.7% to $308.6m.
“The production of palm oil is largely a fixed cost business and hence a reduction in throughput impacts the group’s profitability,” said CEO Nick Thompson. “The cost saving initiatives we have embedded together with the continuing currency depreciation bodes well for the group’s cash cost per tonne of oil produced and we are well-positioned to take advantage of increased commodity prices in the future.”
Click here to view the full earnings release.