GAR’s Resilient Financial Performance in Q1 2024 Boosted by Integrated Operations and Downstream Sales

Golden Agri-Resources Ltd (“GAR”) has reported a sustained first quarter 2024 EBITDA margin of over nine percent, showcasing the company’s resilience in the face of challenging market conditions. Despite a decrease in CPO market prices, GAR managed to increase its revenue to US$2.56 billion, thanks to increased sales volume.

However, the net profit was impacted by foreign exchange losses, interest expenses, and lower yields due to El Niño. The company’s financial position remained strong with a low gearing ratio of 0.56 times, reflecting its solid foundation.

EBITDA for the quarter stood at US$231 million, maintaining a margin of over nine percent. Underlying profit and net profit were lower at US$79 million and US$37 million, respectively. The declines were attributed to lower plantation output, foreign exchange losses, higher interest expenses, and seasonality of general and administrative expenses.

Looking ahead, Mr. Franky O. Widjaja, GAR Chairman, and CEO, commented on the challenges faced by the industry, including supply constraints and geopolitical tensions. Despite these challenges, GAR remains focused on adding value to its products and services, leveraging innovation and technology to optimize productivity and maintain cost competitiveness.

GAR’s commitment to sustainability is evident in its efforts to enhance traceability in its global supply chain and reduce carbon emissions. The company is on track to achieve Net Zero emissions by 2050 and is actively working towards compliance with regulations such as the EU Deforestation Regulation.

Overall, GAR’s integrated operations and downstream sales have contributed to its resilient financial performance in the first quarter of 2024, positioning the company for continued success in the future.