A recovery in the oilseeds and grains business helped push Wilmar International back into the black in the second quarter.
The agribusiness group yesterday posted a profit of US$60.2 million (S$82 million) for the three months ended June 30, marking a significant reversal from the net loss of US$220.1 million in the same period a year earlier.
This came on the back of higher non-operating gains arising from the group's investment securities, said Wilmar in a statement.
Core net profit was US$37.3 million, compared with a core net loss of US$220.3 million previously. The improvement was largely driven by recovery in the oilseeds and grains business from the one-off losses in the same quarter last year, though partially offset by weaker performances in the tropical oils and sugar businesses.
Revenue grew 13.2 per cent to US$10.6 billion, thanks to higher sales volume from the oilseeds and grains as well as sugar businesses, together with stronger commodity prices.
For the half year ended June 30, net profit skyrocketed 2,087.8 per cent to US$421.8 million, while revenue expanded 15.2 per cent to US$21.17 billion.
Earnings per share for the quarter came in at one US cent, well up on the loss per share of 3.5 US cents previously.
AT A GLANCE
US$60.2 million (N.A.)
US$10.6 billion (+13.2%)
DIVIDENDS PER SHARE:
3 cents (+20%)
Net asset per value rose 3.9 per cent to US$2.38 as at June 30, from US$2.29 as at Dec 31 last year.
Total assets stood at US$37.33 billion as at June 30 while shareholders' funds were US$15.06 billion.
Net debt increased to US$11.83 billion, but net gearing ratio improved to 0.79 times in the first half of the year, compared with 0.81 times in 2016, on the back of a strong performance.
Wilmar has proposed an interim dividend of three cents per share, 20 per cent up on the 2.5 cents previously.
Chairman and chief executive Kuok Khoon Hong said the group expects its tropical oils business to perform better in the second half of the year on the back of improvements in production yields and better margins from downstream operations.
Oilseeds crush margins are expected to remain positive for the rest of the year and consumer products will improve as it enters its seasonal peak period, he noted. But sugar will continue to be affected by the volatility in sugar prices.
"While the group may face short- term challenges, we remain very optimistic about the tremendous growth prospects of our various businesses and will continue with our expansion plans, especially in China, India and Indonesia," said Mr Kuok.
Wilmar shares closed flat at $3.42 yesterday, before the results were announced.