Sime Darby reaps tax harvest in Q2

Plantation conglomerate Sime Darby said Friday its gross earnings were flat in the last quarter of 2013 but increased net profit by 15 percent due to reduced taxes. The world's largest listed palm oil producer by acreage recorded a fiscal second quarter pre-tax profit of RM1.0 billion, down one percent year-on-year but a net profit of RM818.3 million as compared to 707.4 million a year ago. The jump in net earnings was attributed to lower tax costs arising from a temporary difference between its accounted assets and their taxable value. Sime Darby maintained that it had faced a volatile market in its fiscal second quarter which had also halved its net profit in the preceding quarter. While its mainstay plantation unit suffered a 13 percent drop in fresh fruit bunch production, higher crude palm oil prices helped keep the group's revenue at RM10.878 billion, down just three percent. Sime Darby's other businesses, such as its industrial, motors and energy division, also suffered from falling sales. For the first half of its financial year, Sime Darby reported a net profit of RM1.3 billion, a decline of 23 percent from the previous year. The company said it was targeting a net profit of RM2.8 billion for the year, 24 percent less than the past fiscal year.