Golden Agri-Resources (GAR), an Indonesia-based palm oil plantation company, announced today that it has recorded its 2018 revenue of US$7.2 billion, a slight decrease compared to the previous year as affected by weaker palm oil prices.

Mr. Franky O. Widjaja, GAR Chairman and Chief Executive Officer, said: “2018 was a challenging year for operators in the palm oil industry. I am pleased that GAR once again proved resilient in unfavourable circumstances, based on our long-term investment in a vertically integrated operation.”

GAR’s fourth quarter EBITDA (earnings before tax among other factors) and underlying profit achieved US$203 million and US$101 million, respectively, contributing to full year 2018 EBITDA of US$573 million and underlying profit of US$181 million.

On the bottom line, GAR recorded a full year net loss of US$2 million primarily because of foreign exchange loss, loss from changes in fair value of biological assets and deferred tax expense.

Declining palm oil prices continued to be the main factor in weaker performance in 2018, especially from the plantations and palm oil segment. The industry as a whole saw very strong plantation output in 2018, resulting in high inventory levels and lower prices.

However, GAR said it proved resilient in the challenging business environment, with a robust financial position as at 31 December 2018. Total consolidated assets grew to US$8.55 billion whilst net gearing ratio was maintained at 0.42 times.

For the 2018 performance, the Board proposes a final dividend of 0.58 Singapore cents per share or approximately US$54 million in total. This is in line with GAR’s dividend policy of distributing up to 30 percent of underlying profit to shareholders. The proposed final dividend will be distributed in 10 May 2019 subject to approval from GAR’s shareholders at the Annual Meeting.

“We see demand from the energy sector as an important industry catalyst. Underpinned by strong support from the Indonesian government in implementing a larger biodiesel mixture mandate, we are optimistic that this will promote tighter supply and demand for palm oil and will eventually have a positive impact on CPO prices, ” Mr. Widjaja added.

Founded in 1996 and listed on the Singapore Exchange in 1999, GAR is hailed as one of the leading palm oil plantation companies.

It has a total planted area of nearly 500,000 hectares (including plasma smallholders) as at 31 December 2018, with its integrated operations focused on the production of palm-based edible oil and fat.