Half year results of the SIPEF group per 30 June 2021
• Total group production of palm oil increased by 18.0%, compared to the first half of last year, due to higher yields in favourable agronomic conditions.
• The coronavirus continues to complicate the management of overseas companies, but without any significant impact on 2021 group production.
• The SIPEF group will be able to exceed the predicted growth in annual palm oil production by more than 10%, barring exceptional weather effects.
• The first semester in the palm oil market can be characterised as a very stable environment, with high prices averaging above USD 1 100 per tonne CIF Rotterdam.
• SIPEF is confident of continued strong prices in the second half of 2021.
• The recent easing of the system of government levies on palm oil supplies will further improve the profitability of Indonesian palm oil companies.
• The recurring* operating result increased from KUSD 4 621 at the end of June 2020 to KUSD 50 129 at the end of June 2021.
• The sale of PT Melania (rubber and tea operations), of which 40% was realised in May, has generated a cash flow of USD 19 million to date and a total capital gain, share of the Group, of KUSD 11 003.
• The net result, share of the Group, including this capital gain, amounted to KUSD 43 519, compared to KUSD -712 at 30 June 2020.
• With 75% of the expected palm oil production sold and the prospect of continued favourable market prices for palm oil, the Group's recurring annual results should be in the range of USD 60 - 70 million.
• Net financial debt position will decrease further.
• The expansion in South Sumatra is being pursued steadily, with 14 490 hectares already cultivated in Musi Rawas and 5 832 hectares replanted in Dendymarker.
• The recently announced project to expand almost 80% of the banana production in Ivory Coast will start in the third quarter.
• SIPEF is offering covid-19 vaccinations, free of charge, to all employees and their families in line with its ESG policies.
• As an RSPO-compliant producer, SIPEF continues to supply certified, traceable sustainable palm oil to the European and Asian markets.
* Recurring results are exclusive of the capital gain of KUSD 11 640 (of which KUSD 11 003 share of the Group) related to the sale of PT Melania.