AEP Plantations (LSE:AEP), which owns, operates and develops sustainable oil palm plantations in Indonesia and Malaysia, said the Board remains confident of delivering results in line with market expectations for the full year, supported by what it called favourable long-term crude palm oil (CPO) fundamentals.
Own fresh fruit bunch (FFB) production for the nine months to 30 September rose 13.3% to 924,500 tonnes, against 816,200 tonnes in the same period last year, driven by stronger output in Kalimantan and the newly acquired PT AEP Pinago Plantations Tbk in South Sumatra.
CPO production climbed 17.9% to 379,200 tonnes and palm kernel (PK) output rose 17.0% to 93,100 tonnes, both lifted by higher volumes from Pinago and Bengkulu.
External FFB purchases jumped 24.2% to 1.1m tonnes, reflecting increased third-party intake alongside the Group's own production growth.
Net cash after borrowings stood at $99.0m at the end of September, down sharply from $232.3m at 31 December 2025, after $160.2m of acquisition spending on Pinago and $8.4m on Admiral Potential Sdn Bhd and PT Jaya Jadi Utama (JJU).
The Group also returned $33.2m to shareholders during the period, split between $16.8m in dividends and $16.4m in share buybacks.
The Pinago acquisition, completed on 4 May for roughly $162m, added mature South Sumatra plantation acreage and an integrated mill, and management has consistently described it as immediately accretive to Group production.
Construction of the Group's ninth mill at the KAP Estate in Kalimantan is 98% complete on building and structural works, with machinery fully delivered to site by early October; commissioning is now targeted for early January 2027, later than the December guidance given at the half-year stage.
At the JJU Estate, rehabilitation of identified planted areas is underway, with phased development and new planting expected to take approximately three to five years to complete, subject to approvals.
AEP flagged that prevailing El Niño conditions and prolonged dry weather may affect FFB yields in 2027, though it said no fires have materially affected operations to date and it continues to work with local communities on fire prevention.
The company said CPO prices are expected to remain supported through the fourth quarter, underpinned by food demand, firm energy markets and Indonesia's B50 biodiesel rollout.
"The Group delivered strong production growth for the first nine months of 2026, driven by improved operational performance and higher volumes of external FFB purchased," said Marcus Chan Jau Chwen, Executive Director, Corporate Affairs, adding that the results "underpin the Group's confidence in meeting full-year market expectations while continuing to deliver long-term shareholder value".
Shareholders electing to receive dividends in sterling will have the final dividend of 3.73 cents per share converted at the exchange rate prevailing on 6 November, the record date.