AEP Plantations reports higher 9-month output, declares interim dividend

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AEP Plantations higher output

Highlights

AEP Plantations' own FFB production rises 13.3% to 924,500 metric tons in the first nine months of 2026, driven by Kalimantan and Pinago acquisition output.
Net cash stands at $99.0 million as of 30 September 2026 after $160.2 million Pinago acquisition, $8.4 million other asset purchases, and $33.2 million returned to shareholders.
Board declares interim dividend of 3.73 cents per share for six months ended 30 June 2026, payable 11 December 2026, amid CPO price support from biodiesel and food demand.

Production growth and capital deployment

As reported by London Stock Exchange Regulatory News Service, AEP Plantations says own fresh fruit bunch, or FFB, production for the first nine months of 2026 rises 13.3% to 924,500 metric tons from 816,200 metric tons a year earlier, helped by stronger output in Kalimantan and the recently acquired PT AEP Pinago Plantations tbk in South Sumatra. External FFB purchases also increase 24.2% to 1,097,800 metric tons from 883,600 metric tons in the same period of 2025.

Crude palm oil, or CPO, production rises 17.9% to 379,200 metric tons, while palm kernel production increases 17.0% to 93,100 metric tons, driven by higher output in South Sumatra and Bengkulu. Executive Director for Corporate Affairs Marcus Chan Jau Chwen says the group delivers strong production growth in the first nine months of 2026 through improved operational performance and higher volumes of external FFB purchased.

As of 30 September 2026, the group has net cash of $99.0 million after borrowings, including cash, cash equivalents and short-term bank deposits. The decline mainly reflects $160.2 million spent on the Pinago acquisition, $8.4 million for Admiral Potential Sdn Bhd and PT Jaya Jadi Utama, and $33.2 million returned to shareholders through $16.8 million in dividends and $16.4 million in share buybacks.

Dividend outlook and operational risks

The board declares an interim dividend of 3.73 cents per share for the six months ended 30 June 2026, payable on 11 December 2026 to shareholders on the register on 6 November 2026. AEP Plantations also says CPO prices are expected to remain supported through the final quarter of 2026 by food demand, firm energy markets and Indonesia's B50 biodiesel rollout.

In its estate development program, the group undertakes new planting of more than 430 hectares and replants 1,785 hectares during the period. Construction of its ninth mill at KAP Estate in Kalimantan remains on track for commissioning in early January 2027, with building and structural works 98% complete as of 30 September 2026 and all machinery fabricated and delivered to site by early October 2026.

AEP Plantations says prevailing El Niño conditions and prolonged dry weather may affect FFB yields in 2027, although no fires from the dry conditions materially affect operations. The group says it continues to work with local communities on training, fire prevention awareness and firefighting practices to help reduce fire risks.

Malaysia’s September 2026 palm oil stock build highlighted how rising production can quickly lift inventories when exports soften. In our earlier article, we outlined that crude palm oil and palm kernel output increased month on month, while palm oil exports fell, pushing total stocks up to 3.51 million tonnes and signalling a supply-heavy balance heading into the next period.

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