News

Wilmar sees 47% profit increase

15 Nov 2016

Agribusiness group Wilmar International has reported a 47% increase in net profit to US$392.2 million for the quarter ended September 30, 2016 (“3Q2016”) (3Q2015: US$267.6 million).

Agribusiness group Wilmar International has reported a 47% increase in net profit to US$392.2 million for the quarter ended September 30, 2016 (“3Q2016”) (3Q2015: US$267.6 million). Core net profit grew 10% to US$384.9 million (3Q2015: US$350.7 million).

The company said that the improved earnings were driven by good performance from the Tropical Oils segment and the Oilseeds and Grains segment which saw a significant recovery from 2Q2016. The Sugar segment posted weaker profits due to wet weather in Australia which further delayed cane harvesting activities. Overall strong performance resulted in a significant improvement in earnings before interest, taxes, depreciation and amortisation (EBITDA) by 39% to US$798.7 million in 3Q2016 (3Q2015: US$576.5 million).

Revenue for the quarter increased 4% to US$11.08 billion (3Q2015: US$ 10.65 billion), mainly due to higher commodity prices.

The Group’s net profit for the nine months ended September 30, 2016 (“9M2016”) decreased 41% to US$411.5 million (9M2015: US$692.8 million) as a result of the losses incurred in 2Q2016, while revenue was marginally higher at US$29.45 billion (9M2015: US$29.35 billion). Core net profit declined 51% to US$387.1 million in 9M2016 (9M2015: US$789.9 million).

Tropical Oils (Plantation, Manufacturing & Merchandising) achieved an 81% increase in pretax profit to US$169.3 million in 3Q2016 (3Q2015: US$93.7 million) on the back of good performance from downstream businesses. Although plantation results were affected by lower production volume, the impact on pretax profit was marginal, due to improved crude palm oil prices during the quarter.

Production yield for plantations, which was affected by the El Nino phenomenon, declined 14% to 4.7 metric tonnes (“MT”) per hectare as production of fresh fruit bunches decreased 18% to 924,912 MT (3Q2015: 1,129,946 MT).

Oilseeds & Grains (Manufacturing & Consumer Products) registered strong pretax profit of US$248.1 million in 3Q2016 (3Q2015: US$243.6 million) from both the Consumer Products and Oilseed crushing businesses.

Sugar (Milling, Merchandising, Refining & Consumer Products) reported a 21% decline in pretax profit to US$86.4 million (3Q2015: US$108.7 million) owing to continued disruption in harvesting due to wet weather in Australia as well as weaker performance by the merchandising business.

“The recovery in the Group’s third quarter results was driven by good performances in both the Oilseeds and Grains as well as Tropical Oils segments,” said Kuok Khoon Hong, Chairman and CEO. “Looking ahead, 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. Barring any unforeseen circumstances, the Group’s performance for the rest of the year is expected to be satisfactory.”