Q3 Results is Coming - Which Plantation Company to Invest?

Recently, rebound in crude palm oil prices has attract investors to re-look into plantation sector. Third quarter financial report is expected to release around mid of November.

Now, let looks on some keys data that can help to determine which company to invest. In this post, I will focus on production data which is the main revenue for plantation company. I had compiled fresh fruit bunch (FFB), crude palm oil (CPO), and palm kernel (PK) production data for month January to September.

Table 1: Monthly FFB Production (Metric Tonne)

Table 2: Monthly CPO Production (Metric Tonne)

Table 3: Monthly PK Production (Metric Tonne)

Table 4: Quarterly FFB Production (Metric Tonne)

Table 5: Quarterly CPO Production (Metric Tonne)

 Table 6: Quarterly PK Production (Metric Tonne)

Based on production data, IOICORP, GENP, IJMPLNT, SOP, BPLANT, THPLANT, RSAWIT, KRETAM, FAREAST, UMCCA, HARNLEN, MHC and CEPAT are potential company to looks on.

Can Rimbunan Sawit Berhad (RSAWIT) Turn Around with Q3 Earnings?

Rimbunan Sawit Berhad is a Sarawak plantation company that established since 2005 with 92,312 Ha of plantation land. Based on Financial Report Year End 2015, Planted Area = 57,217 Ha.

Rsawit has reported 7 consecutive quarter losses. However, can we see turnaround for next quarter earnings (3Q2016)?

Based on monthly production data reported. Production of Fresh Fruit Bunch (FFB), Crude Palm Oil (CPO) and Palm Kernel (PK) has increased significantly since June

Based on quarterly production data. Third quarter production of  FFB +36%, PK +35%, CPO +40%. compare with second quarter.

Monthly average CPO price for Sarawak region in 3Q is also higher than 2Q.
Supported by higher production and higher price, RSAWIT is expected generate higher revenue.

Based on my assumption and calculation, revenue for 3Q should be increase by >35%, and enough for the company to post profit.




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