IOI Corp Bhd, Malaysia's most valuable firm, reported a 77 per cent surge in the first quarter net profit due to high palm oil price and better sales from its property and manufacturing divisions.
It also expects all of its business to show improvement for the year to June 30 2008.
IOI made a net profit of RM451.5 million for the first quarter ended September 30 2007. Revenue jumped 64 per cent to RM3.12 billion.
"All major business segments reported increase in revenue," IOI said in a statement to Bursa Malaysia yesterday.
The group is benefiting from high crude palm oil (CPO) price which hit a record of more than RM3,000 per tonne this year. This was mainly due to the rising use of CPO as an alternative energy source.
It said that it sold CPO at an average price of RM2,473 per tonne for the quarter, compared with RM1,483 for the same quarter last year.
Plantation earnings for the quarter more than doubled to RM397.5 million.
The group's resource-based manufacturing segment, where it makes chemicals and specialty fats derived from palm oil, posted a one-third jump in operating profit to RM122.8 million.
On the property side, the division continued to perform well with an increase in operating profit by 39 per cent to RM109.7 million.
This was driven largely by higher demand for commercial and high-end residential properties.
IOI Corp executive chairman Tan Sri Lee Shin Cheng told reporters after its annual general meeting recently that the group is set to achieve another record high in the current fiscal year.
The group reported a 78 per cent surge in net profit to a record RM1.4 billion in the year ended June 2007, on the back of a record RM8.9 billion revenue.
IOI also said its wholly-owned subsidiary, IOI Resources (L) Bhd, is issuing up to US$600 million (RM2.02 billion) exchangeable bonds which can be exchanged into IOI Corp shares of 10 sen each.
The bonds will be issued and offered outside Malaysia to certain non-US persons.
Money from the bond issue will be used to fund capital expenditure, investment or acquisition opportunities and working capital.
By New Straits Times (By Sharen Kaur)
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