Palm oil giant Sime Darby profits double

KUALA LUMPUR: Malaysian palm oil giant Sime Darby Berhad said Thursday its second quarter net profit doubled despite a cost overruns scandal, thanks to improved plantation and energy operations.

The world's largest listed palm oil producer said in a filing with the local bourse it made a net profit of 877.1 million ringgit ($286 million) for the quarter ended December 31, up 104.8 percent from 428.2 million ringgit a year earlier.

Sime Darby, which has a market capitalization of more than 55 billion ringgit and interests in energy, heavy equipment, auto distribution and property, said second quarter revenues rose 22 percent to 10.28 billion ringgit.

For the first half, net profit rose to 1.53 billion ringgit from 1.11 billion a year earlier, while revenue rose to 19.07 billion from 16.17 billion.

The plantation division achieved an average crude palm oil price of 2,692 ringgit a metric ton, compared with 2,222 ringgit for the same period a year earlier.

"We had a commendable first half considering the weather disruptions experienced in our Malaysian and Indonesian plantations," Sime Darby president and group chief executive Mohammad Bakke Salleh said in a statement.

The company said its energy and utilities division reported an operating profit of 73.0 million ringgit for the first half of the year, mainly due to its power and utilities businesses.

The palm oil giant's results were in sharp contrast to its first quarter profits, which slid 4.37 percent from a year earlier due to weakness in the plantations and energy sector.

Several senior executives including the group's former head are facing corruption charges following an investigation by anti-graft authorities after the energy and utilities division declared 2.09 billion ringgit in cost overruns and provisions in the group's last annual results.

The huge overruns involved several major projects including the controversial Bakun hydroelectric dam on Borneo island in eastern Malaysia, and oil works in Qatar.