Benso Oil Palm Plantation has recorded a rise in its revenue by 20.1 percent, for the first half of 2019, compared to the corresponding period of 2018, to reach GHc55.14 million.
This has been possible despite a 16.8 percent year on year drop in the average Crude Palm Oil (CPO) price during the period.
Market analysts believe that the revenue gains were driven by improved CPO output arising from better weather conditions that boosted productivity. In addition, BOPP earns its revenue in USD, and as such the weakening of the Cedi against the US Dollar by 8.23 percent in the first half of 2019 helped to cushion revenue against lower CPO prices.
BOPP benefited from a weaker Cedi as palm oil is an export-oriented commodity priced in US Dollars while the cost of production is denominated in Cedis.
Although operating expenses grew by 20.6 percent in the first quarter of 2019, compared with the corresponding period of 2018 to GHc 5.99 million in first quarter of 2019, the operating expense ratio (operating expenses/revenue) was just up by 10 basis points to 10.9 percent in the first half of 2019 from 10.8 percent in first half of 2018.
BOPP attributes this to the implementation of cost control measures by the company to mitigate the adverse impact of lower CPO prices on margins.
BOPP’s profit before tax grew by 19.6 percent to GHc 7.31 million during the first half of 2019, while profit after tax rose by 13.0 percent to GHc 6.22 million in the first half of 2019 on the back of the improvement in revenue and cost control measures that ensured that costs didn’t rise significantly to erode margins.
Background
Benso Oil Palm Plantation Limited is a Ghana-based company engaged in the business of growing oil palm. The Company owns over 5,000 hectares of oil palm plantation in Ghana. The Company is a subsidiary of Wilmar International Limited. It is listed on the Ghana Stock Exchange
