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REA Holdings PLC on Thursday said both profit and revenue rose strongly in 2022, despite increased distribution costs and administrative expenses.
REA is a London-based company engaged in oil palm cultivation in Indonesia as well as in producing crude palm and palm kernel oil.
It said pretax profit was $42.0 million in 2022, up 42% on $29.2 million in 2021, on revenue of $208.8 million, up 15% from $191.9 million.
Cost of sales rose by 9.7% to $145.3 million from $132.4 million and distribution costs multiplied to $2.0 million from $637,000 million. Administrative expenses increased to $17.3 million in 2022 from $13.4 million in the prior year.
Operating profit declined to $41.4 million in 2022 from $48.1 million in 2021, but pretax profit benefited from finance gains of $14.7 million, compared to $1.2 million the year before.
REA added that it was anticipating a more solid financial footing, which would provide opportunities for future growth. REA also predicted a progressive reduction in its net indebtedness, and further cash inflows from loan repayments from stone and coal concession holding companies.
Net debt was reduced to $166.7 million on December 31 from $175.7 million a year before.
‘Subject to [crude palm oil] and [crude palm kernel oil] prices remaining at remunerative levels, the group should continue to generate good cash flows which should be augmented by further loan repayments from the coal and stone concession holding companies,’ said Chair David Blackett.
‘The directors expect therefore to continue building on the improvement in the group’s operational and financial position.’
REA declared no dividend on ordinary shares for 2022.
Shares in REA were up 3.0% at 107.11 pence in London on Thursday.
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