Golden Agri-Resources Q1 net profit falls 20% to US$44 million amid weaker upstream business

[SINGAPORE] Golden Agri-Resources delivered a net profit of US$44 million for its first quarter ended Mar 31, a decline of 20 per cent from US$55 million in the previous corresponding period.

Noting that commodity markets faced volatility due to escalating geopolitical tensions, the company said that earnings moderated primarily due to weaker contributions from the upstream segment, with declines in both palm product output and average selling prices.

For the quarter, the average crude palm oil (CPO) market price fell 2 per cent year on year to US$1,136 per tonne, from US$1,156.

The upstream palm product output for the quarter, which includes CPO, decreased 10 per cent to 592,000 tonnes, from 658,000 tonnes.

Higher income tax expenses, driven by higher taxable profits in certain subsidiaries and additional cost for provisioning, also contributed to the bottom-line declines.

Despite lower earnings, revenue for the quarter rose 6 per cent on the year to US$3.2 billion from US$3 billion, driven by expanded merchandising volume from the downstream business, which partly mitigated the impact of lower CPO prices.

Downstream sales volume climbed 2 per cent to 2.81 million tonnes from 2.76 million tonnes.

For the three months, gross profit rose 4 per cent to US$450 million from US$433 million.

Earnings before interest, taxes, depreciation, and amortisation (Ebitda) dropped 7 per cent year on year to US$241 million, from US$259 million.

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Financial position, El Nino risk

Anticipating a “stronger-than-usual” dry season in Indonesia this year as a result of El Nino conditions, the group said it remains vigilant in its approach to fire risk.

It has strengthened detection and response capabilities, deployed new fire detection technology and continued its close collaboration with communities.

In terms of financial position, the company had a gearing of 0.55 times and a net debt to Ebitda of 0.24 times.

Total liabilities stood at US$5.2 billion as at Mar 31, up 4 per cent from US$4.9 billion as at Dec 31, as total assets stood at US$10.9 billion, up 2 per cent from US$10.7 billion.

Total equity as at March was steady at US$5.8 billion, 0.4 per cent higher than US$5.7 billion as at December.

Its interest bearing debts dropped 2 per cent to US$3.19 billion as at March, from US$3.25 billion as at December.

Golden Agri-Resources noted that escalating diesel prices due to the global energy shortage have accelerated adoption of biofuel mandates across major countries including the US, Indonesia, Malaysia and Thailand.

“This surge in demand from the energy sector is adding pressure to vegetable oil supplies and sustaining higher prices,” the company said.

It added that palm oil production has been constrained in early 2026, compounded by the structural challenges of ageing plantations and replanting cycles.

“Tightening supply is further exacerbated by developing El Nino conditions and potentially reduced fertiliser application driven by elevated input prices,” it said.

“Together, these factors are expected to keep CPO prices elevated in the near term, even as geopolitical tensions may gradually ease.”