ANJ'S REVENUES INCREASED BY 25.6% IN THE SECOND QUARTER OF 2023

01 Aug 2023

 

Jakarta, 1 August 2023 – PT Austindo Nusantara Jaya Tbk. ("ANJ"; IDX: ANJT) reported a quarterly revenue increase of 25.6%, reaching USD 63.9 million in the second quarter of 2023 compared to USD 50.9 million in the first quarter of 2023. This increase was primarily driven by higher proceeds from CPO sales, PK, and PKO during this period. Thanks to this outstanding performance, ANJ significantly reduced its net loss by 72.4% to USD 1.1 million in the second quarter of 2023, compared to USD 3.9 million in the previous quarter.

Nopri Pitoy, Finance Director of ANJ, revealed that ANJ's operational and financial performance in the second quarter of 2023 had improved due to the continuous increase in FFB production. "We estimate that the positive production trend since the beginning of the year will continue and further increase in the second half of this year, as the plantations reach their peak production period in the third quarter and the area of mature plantations expands," said Nopri.

The increase in production aligns with ANJ's strategy of balancing plant ages through a massive replanting program implemented in recent years. "As a result of our commitment to implementing a replanting program in North Sumatra and Belitung Island, along with infrastructure development in Southwest Papua, we believe this positive trend puts us on track to achieve new milestones in FFB production by 2025, by the company's targets," added Nopri.

ANJ recorded an 8.6% increase in Fresh Fruit Bunches (FFB) production by the end of June 2023, reaching a total of 414,919mt, compared to 382,100 mt in the same period last year. "The increase in FFB production in the first semester of 2023 was supported by higher output from several plantation areas that had just entered the early mature stage with high productivity."

For example, the Belitung Island plantation experienced a 25.4% increase, producing 113,949 mt of FFB in the first half of 2023 compared to last year. This growth was supported by the high productivity of oil palm trees resulting from the replanting program as they reached maturity. Additionally, the young mature plantations in SouthSumatra contributed 4,291 mt of FFB production, a remarkable increase of 56.0% compared to the same period last year, which was 2,750 mt.

Alongside the increase in FFB production volume, ANJ also recorded a 3.1% increase in Crude Palm Oil (CPO) production, reaching 134,749 mt by the end of June 2023, compared to 130,722 mt at the end of June 2022. This growth boosted CPO sales volume to 135,147 mt by the end of June 2023, representing a 16.1% increase compared to 116,247 mt in the same period in 2022.

However, CPO prices decreased in the second quarter of 2023, touching their lowest point since November 2020, due to higher production volumes of palm oil and reduced costs for other vegetable oils amid fears of a possible global economic recession and an estimated increase in production of other vegetable oils, such as soybean oil. As a result, the total revenue until the end of June 2023 amounted to USD 114.8 million, reflecting a decrease of 20.4% compared to the same period in the previous year.
ANJ also recorded higher depreciation, interest expenses, and operating costs in the newly matured areas of its Southwest Papua plantation and the replanting areas of its North Sumatra I plantation and Belitung Island plantation. As a result, ANJ recorded a net loss of USD 5 million. With an anticipated increase in production in these areas, expected to reach optimal levels within the next two to three years, the cash cost per ton is also likely to decline due to the fixed nature of the production and overhead costs.

"We hope that the company's performance in the remainder of 2023 will continue to improve, with an estimated CPO price in the range of USD 700 – 1,000 per tonne. The factors driving this price increase are El Nino and increased tensions between Russia and Ukraine, which can potentially suppress the supply of vegetable oil in the global market," explained Nopri.

In addition to the replanting program, ANJ also carries out innovations in agronomic practices such as drip fertigation, composting, and assisted pollination, which can increase productivity while mitigating the impact of climate change. ANJ's climate change mitigation and adaptation projects have been carried out since 2012, integrating ESG initiatives and the company's business strategy to achieve net-zero emissions targets by 2030.

About ANJ: ANJ is a holding company involved, directly and through its subsidiaries, in the production and sale of crude palm oil, palm kernel, and other sustainable food products and renewable energy. ANJ owns and operates six producing oil palm plantations and is integrated with five factories.

As of Q2 2023, ANJ has 154.6 thousand hectares of land reserves, including 49.3 thousand hectares of total planted area, with an average plant age profile of 13.3 years. The total producing area is 44.7 thousand hectares, with 4.6 thousand hectares classified as immature areas. Furthermore, ANJ has designated 97,682 hectares as a High Conservation Value (HCV) forest to preserve flora, fauna, and their habitats.

 

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