PALM CI Q1 Profit Drops But Company Says Backlog to Clear in H2

Daba Finance/PALM CI Q1 Profit Drops Sharply But Company Says Backlog to Clear in H2

AFRICAN STOCKS AND FINANCEMay 1, 2026 at 12:45 PM UTC

TLDR

PALMCI, a palm oil producer based in Abidjan, reported a 86% decrease in net profit in Q1 2026 compared to the previous year.
The profit fall was attributed to lower volumes and weaker prices affecting revenue and margins, with inventory being a key factor.
Despite the decline, PALMCI anticipates improved performance in Q2 and beyond as it sells accumulated finished goods into export markets with higher prices.

PALM Cote d'Ivoire (BRVM: PALC), the Abidjan-based palm oil producer, posted net profit of 1.6 billion FCFA ($2.9 million) in the first quarter of 2026, down 86% from 11.6 billion FCFA ($20.7 million) a year earlier, as lower volumes and weaker prices hit both revenue and margins simultaneously.

Revenue fell 27% to 49.4 billion FCFA ($88.3 million) from 67.5 billion FCFA ($120.7 million). The company said the decline reflected fewer sales of crude palm and palm kernel oil on the local market — and was explicit that this was a timing issue rather than a structural one.

The key context is inventory. PALMCI said it held a meaningful stock of finished goods at the end of March, the sale of which began in April 2026 and will continue in coming months — notably into export markets, where prices are higher than domestic. That stock will convert into revenue and profit in Q2 and beyond, which is why the company guided toward a full-year net profit in line with 2025.

The business model means first-quarter results are always read with this caveat: palm oil production and sales do not move evenly through the year, and the Q1 2025 comparison was itself elevated by strong pricing conditions that no longer exist.

For full year 2025, PALMCI earned 15.5 billion FCFA ($27.7 million) net. The company said current plantation production levels — both from its own industrial plantations and from smallholder purchases — are consistent with reaching a similar result in 2026.

Key Takeaways

PALMCI is a subsidiary of the SIFCA Group, the Ivorian agro-industrial conglomerate that also controls SAPH. Côte d'Ivoire is a significant palm oil producer, though it operates in the shadow of Malaysia and Indonesia, which together dominate global supply and pricing. The local market for crude palm oil is subject to government pricing mechanisms designed to keep processed food affordable, which limits the upside available to domestic sellers — hence the commercial logic of exporting at world prices when possible. The 86% profit drop in Q1 is alarming at first glance but requires the context PALMCI itself provides: it sold less, not because it produced less, but because finished goods accumulated in inventory pending better export opportunities. That is a cash flow and working capital question, not a production failure. The more interesting structural question for PALMCI investors is how the company positions itself relative to the EUDR, which covers palm oil as one of its seven deforestation-linked commodities. Palm oil produced on land cleared after December 31, 2020 will be excluded from the EU market from December 2026. PALMCI's industrial plantations are established, but the smallholder network the company sources from will require traceability investment to confirm compliance.

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