LISTED COMPANY - JAKARTA. Palm oil issuer, Sampoerna Agro (SGRO) is preparing a capital expenditure budget (capex) for this year between Rp 400 billion to Rp 700 billion.
Sampoerna Agro's Investor Relations Stefanus Darmagiri said this fund will be allocated for plantation and non-plantation activities.
“In 2024, the Company budgeted a capex of Rp400 to 700 billion. Where 40% of it will be used for plantation activities and the other 60% for non-plantation activities,” Stefanus revealed when contacted by Kontan, Thursday (07/03).
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Stefanus added, that this year SGRO is also quite optimistic about the production of Fresh Fruit Bunches (TBS) even though it is still affected by the impact of El Nino last year.
“The production of Fresh Fruit Bunches (TBS) in our core plantation is expected to still grow in 2024. However, TBS production from plasma plantations is expected to decrease, one of which is caused by the replanting activity from the plasma plantation. We hope the total production of TBS (core and plasma) in 2024 can still be the same as the previous year,” he explained.
Regarding the addition of palm oil mills (PKS) this year, the company revealed that it is still monitoring and studying the plan for additions. However, if it relates to increasing production capacity, SGRO revealed that it remains focused on improving operational performance.
“That is by continuing the intensification program that has been running in previous years such as mechanization, water management system, and infrastructure improvements as well as digitization to improve monitoring, production effectiveness, and work efficiency in the plantation,” Stefanus revealed.
Regarding the profit and revenue growth target in 2024, Stefanus said that the current target is still very much influenced by the selling price of CPO, which is very dependent on market mechanisms and price fluctuations.
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Therefore, the Company will remain focused on the program to increase palm oil productivity through programs that have been carried out previously and carry out work efficiency to be able to improve operational and financial performance.
“The price of CPO is expected to remain solid in the first semester of 2024, which is supported by the upcoming Ramadan which will start in early March 2024, and the full implementation of the B35 program,” he said.
Regarding sales expansion, SGRO this year will also still focus on selling CPO for the domestic market, and try to take the best steps amid fluctuations in palm oil prices.
“This is one challenge we see from the palm oil industry (fluctuations in palm oil prices) because it is very dependent on several supply and demand factors. In addition, cost components can also affect the Company's performance,” he concluded.
