Quarterly earnings jump 47% at Wilmar

Edible oils sold under Wilmar's Arawana brand lining shelves at a Shanghai supermarket. A sturdy showing by the tropical oils segment as well as the oilseeds and grains segment boosted group revenues in the third quarter.
Edible oils sold under Wilmar's Arawana brand lining shelves at a Shanghai supermarket. A sturdy showing by the tropical oils segment as well as the oilseeds and grains segment boosted group revenues in the third quarter.PHOTO: BLOOMBERG

Higher commodity prices drive up revenue while investment gains help improve bottom line

Strong core operating profits, investment gains and lower foreign exchange losses lifted quarterly earnings at Wilmar International.

Net profit for the three months ended Sept 30 jumped 46.6 per cent to US$392.2 million (S$548 million), well above the restated US$267.6 million for the same period a year earlier.

Revenue grew 4.1 per cent to US$11.08 billion, mainly because of higher commodity prices, Wilmar announced yesterday.

No dividends were declared for the period.

However, for the nine months ended Sept 30, net profit dropped 40.6 per cent to US$411.5 million, while revenue was flat, inching up 0.4 per cent to US$29.45 billion.

  • AT A GLANCE

    NET PROFIT: US$392.2 million (+46.6%)

    REVENUE: US$11.08 billion (+4.1%)

During the quarter, core net profit from operations rose 9.8 per cent to US$384.9 million, driven mainly by the tropical oils, and oilseeds and grains segments. The sugar division posted weaker profits because of wet weather in Australia, which further delayed cane harvesting.

The group also recorded a gain of US$7.4 million from its investment securities, compared with a loss of US$78.9 million previously.

Net gains on other operating items came in at US$19.1 million, a reversal from the net loss of US$153.8 million posted in the same quarter last year, thanks largely to lower foreign exchange losses from financial assets and liabilities.

Earnings per share came to 6.2 US cents, down from the restated 4.2 US cents previously. Net asset value per share slipped to 226.4 US cents as at Sept 30, compared with 228 US cents as at Dec 31 last year.

Total assets amounted to US$35.52 billion as at the end of the quarter, while shareholders' funds were US$14.3 billion.

Gross loans and borrowings decreased by US$1.5 billion to US$15.93 billion, while net loans and borrowings shrank by US$508.5 million to US$11.31 billion. As a result, the net gearing ratio improved to 0.79 times, compared with 0.82 times as at the end of last year.

"The group will continue to execute on its stated growth strategy, with emphasis on its downstream businesses and focusing on high-growth markets in Asia and Africa," said chairman and chief executive Kuok Khoon Hong.

"Barring any unforeseen circumstances, the group's performance for the rest of the year is expected to be satisfactory."

Wilmar has over 500 manufacturing plants and a distribution network covering China, India, Indonesia and some 50 other countries.

The counter closed three cents higher at $3.35 yesterday, before the results were announced.

A version of this article appeared in the print edition of The Straits Times on November 11, 2016, with the headline 'Quarterly earnings jump 47% at Wilmar'. Print Edition | Subscribe