Golden Agri Resources’ net profit jumps 48% to a whopping US$571m in 2011

As its palm products output grew to a record level of 2.64 million tonnes last year.

Golden Agri-Resources Ltd reported full year revenue of almost US$6 billion, a 70% increase from last year’s achievement, bringing core net profit to US$571 million, higher by 48%.

Continued strong recovery in production accompanied by a 26% rise in CPO FOB prices year-on-year resulted in full year EBITDA of US$942 million, growing by 43% compared to 2010. Net profit was affected by lower accounting gains recognized from changes in the fair value of biological assets in 2011 compared to 2010.

For fourth quarter 2011, GAR recorded EBITDA of US$181 million and core net profitof US$91 million, lower than those in fourth quarter 2010. This was mainly due to the decrease in palm products output and weaker CPO FOB prices compared to the same period in 2010. Higher fertiliser costs and export tax also contributed to the lower quarterly performance.

The Board proposes a record final dividend of 1.84 Singapore cents, 139% higher than previous year’s dividend. The 2011 proposed dividend is to be distributed in May 2012, after obtaining shareholders’ approval.

As at 31 December 2011, total assets grew by 17% to almost US$11.8 billion compared to US$10.1 billion at the end of 2010, while total liabilities stood at US$3.7 billion. This financial position was supported by robust cash flows and a low gearing ratio of 0.09 times.

OPERATIONAL HIGHLIGHTS
During 2011, palm products output reached a record level at 2.64 million tonnes after a strong recovery by 16%. This achievement was supported by favourable weather conditions and expansion of mature area by 27,300 hectares. For the last quarter of 2011, palm products output continued to grow by 2% quarter on quarter, reaching 701,000 tonnes.

In spite of having a larger percentage of trees with young age profile compared to the previous year, GAR was able to increase its fresh fruit bunch yield by 5% to 21.8 tonnes per hectare in 2011 from 20.8 tonnes per hectare in 2010. The improvement of palm products yield was even larger at 6% to a notable 6.1 tonnes per hectare, from 5.8 tonnes per hectare in the previous year, underpinned by higher oil extraction rate.

GAR managed to add another 13,200 hectares of new estates during 2011, bringing total planted area to reach 455,700 hectares as at end of 2011, the largest in Indonesia. GAR’s near to medium term growth is supported by the favourable average age of its planted trees of 12 years, with large immature and young plantations of 34% and estates in their prime producing years of 44%.