FGV says investors need to assess its performance over long period of time

Felda Global Ventures Holdings Bhd (FGV) has asked its major investors to assess its business performance over a long period of time, its Group President and Chief Executive Officer, Datuk Zakaria Arshad said.

Acknowledging paper losses incurred by all FGV's major investors, he said as a plantation company, direct factors such as weather had affected its performance, hence dampening investor sentiment.

"What is important, we need to see that FGV's fundamentals are still strong and they should be taken into consideration in justifying investments," he said in a statement today in response to the losses incurred by FGV's shareholders.

Since its listing in 2012, FGV has never failed to declare dividends to all its shareholders in the face of challenging situations.

"This clearly shows that FGV is an established company and has a huge potential to grow in the future," he said.

FGV shares are traded around RM1.50-RM1.70 this month.

Zakaria said upon its listing in June 2012, the FGV share issued priced of RM4.55 surged to over RM5.00 at the outset as the market sentiment then was quite good.

He said the price of the commodity, as well as the oil palm industry was at a high level then, while the listing was made at the right time.

"After that, the world's oil palm price declined, dampening investor sentiment on commodity-based counters, including FGV.

"A significant decline in FGV share price was first recorded in 2014 following a sharp decline in the world's crude palm oil (CPO) price and massive floods," he said.

Worse still, the worst El Nino on record hit the country in 2015, which had not only affected FGV but also other oil palm plantation companies, he said.

"In mid-2016, the world's CPO price increased significantly, exceeding RM3,000 per tonne. However, due to the impact of the El Nino, production declined for a much longer time than expected," he said.

Zakaria said FGV was determined to give good returns to shareholders and stakeholders through its business transformation and operations under the 2017-2020 Strategic Plan.

"The strategic plan is expected to bear fruit in 2017 and help the group's operations become sustainable in the long term," he said, adding that FGV was on the right track to achieve the administrative cost savings target of RM100 million.

FGV is also actively improving its core business operations, restructuring its operations, optimising its assets, and strengthening its financial standing. - BERNAMA