Profit Of Palm Oil Company Owned By Conglomerate TP Rachmat Drops 66.26 Percent In First Quarter 2023

Illustration. (Photo: Doc. Antara)

JAKARTA - The palm oil company owned by conglomerate TP Rachmat, PT Triputra Agro Persada Tbk (TAPG) recorded a decrease in net profit and sales in the first quarter of 2023 compared to the same period the previous year.

In the company's financial report, quoted on Tuesday, May 2, the profit attributable to the owners of the parent company TAPG fell 66.26 percent year-on-year (yoy) to Rp294.7 billion compared to the first quarter of 2022 of Rp873.5 billion. The company's decline in net profit was due to a decrease in sales of 12.09 percent yoy to Rp1.92 trillion compared to the same period in 2022 of Rp2.19 trillion.

In detail, based on the segment, TAPG sales were supported by palm oil and palm kernel which contributed Rp1.92 trillion. However, this figure decreased compared to the achievement in the first quarter of 2022 of Rp2.16 trillion.

Meanwhile, the company's rubber sales contribution fell to Rp5.73 billion compared to the same period in 2022 of Rp8.19 billion. Meanwhile, the company's sales of fresh fruit bunches (FFB) were nil during the first quarter of 2023 compared to the previous year of Rp13.93 billion.

TAPG management explained that the company's decline in profit and revenue was caused by two main things. First, lower FFB production compared to the same period in the previous year because plants were in a recovery period after reaching a high production rate last year. Second, the selling price of crude palm oil (CPO) is sloping along with the movement of global commodity prices.

"This production decline is a natural cycle where after achieving very high production last year, oil palm experienced a recovery phase," said TAPG President Director Tjandra Karya Hermanto in an official statement.

In the first quarter of 2023, TAPG's fresh fruit bunch production including association companies reached 619,000 tons, this figure has decreased by 12 percent compared to the same period in the previous year with a yield achievement of 4.7 tons/hectare and an average plant life rate of 12.9 years.

The selling price of crude palm oil (CPO) fell by 17 percent compared to the previous year, while the selling price of palm kernels (PK) actually experienced a significant price decline of 53 percent.

Meanwhile, TAPG's cost of goods sold rose 6.43 percent to Rp1.45 trillion compared to the same period the previous year of Rp1.36 trillion. As a result, the company's gross profit was cut by 42.77 percent to Rp472.18 billion. Based on the balance sheet, TAPG's total assets until March 31, 2023 amounted to Rp14.7 trillion compared to the position at the end of December 2022 of Rp14.52 trillion.

The company's liabilities fell to IDR 3.98 trillion compared to the end of 2022 of IDR 4.11 trillion. Meanwhile, equity rose to IDR 10.71 trillion compared to December 2022 of IDR 10.41 trillion. However, the company estimates that this cycle will improve in the next quarter, TAPG is optimistic that it can improve financial performance in the following months.

"In global conditions, demand from the largest consumer countries such as China and India is also expected to improve as CPO competitiveness is much higher than other vegetable oils. Covid-19 policies will also be abandoned so as to facilitate global trade," concluded Tjandra.