FIRST : EB5 +0.72%Resources : EB5 +0.72% reported a 73.8 per cent fall in net profit to US$19.3 million for the first quarter ended Mar 31, from US$73.6 million the year before.

 

The palm oil producer&rsquo s sales decreased 34.7 per cent to US$198.2 million, from US$303.5 million. 

 

Against record-high palm oil prices in 2022, First Resources&rsquo average selling prices and profitability for Q1 moderated due to a high-base effect, it said on Friday (May 12). 

 

It added that overall sales volumes were impacted by a net inventory build-up of 19,000 tonnes and lower production volumes. 

 

In the quarter, the company harvested 731,672 tonnes of fresh fruit bunches, down 2.8 per cent from 752,927 tonnes the previous year. 

 

Crude palm oil production declined 3.8 per cent to 185,263 tonnes, from 192,667 tonnes. 

 

The group&rsquo s earnings before interest, taxes, depreciation and amortisation for Q1 was US$55.1 million, down 55.3 per cent from US$123.3 million. 

 

&ldquo Palm oil prices had moderated since mid-last year and have been restrained by weakening prices of competing vegetable oils amid ample world supplies and the extension of the Black Sea Grain Initiative in March this year,&rdquo said First Resources. 

 

However, the group added that the fundamentals of the palm oil industry were still supported by tight inventories from producing countries and continued domestic consumption demand from Indonesia, due to a policy restricting the country&rsquo s palm oil export volumes.

 

As at Mar 31, the group said its &ldquo financial position remains strong&rdquo with a gross gearing ratio of 0.19 times, as well as cash and bank balances of US$486 million.