SINGAPORE - Agricultural products supplier Olam International said on Thursday its net profit for the third quarter nearly tripled, owing to a fair value gain of $271 million from the revaluation of its stake in natural sweetener company PureCircle.
Net profit for the three months to March 31 jumped 265 per cent over a year ago to $396.1 million, Olam said.
But excluding exceptional items like the fair value gain, operational net profit would have fallen 7.9 per cent to $276.9 million, driven by higher depreciation and amortisation and tax expenses.
The group's revenue rose 2.5 per cent in the quarter from the previous year to $4.8 billion, as sales volumes climbed 3.5 per cent.
Olam said it continued to improve its cash flow situation in the third quarter, with higher operating cash flows, lower net fixed capital investments and the continued execution of strategic initiatives to "unlock value and release cash".
Nine of its 12 strategic initiatives have been completed, releasing cash of $395.8 million, it said. The remaining three initiatives are expected to be completed in the current quarter and will release further cash of about $154.6 million.
"The twin goals of profitable growth and generating positive free cash flow continued to be the focus of our actions during this period," said Olam's group managing director and chief executive Sunny Verghese.
"We are ahead of target in executing our strategic plan initiatives to release cash and optimise our balance sheet," he added.