Olam half-year earnings up 6.4%

by World Grain Staff
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SINGAPORE — Olam International Limited reported on Feb. 14 profit after tax of S$186.8 million for the half year ended Dec. 31 2011, an increase of 6.4% over the previous corresponding half year and operational profit after tax and minority interests (PATMI) of S$162.7 million, up 14.9% over the same period a year ago.

Sales volume registered strong growth of 15.8% year-on-year to 4.52 million tonnes. Net contribution (NC) improved 18.5% to S$607.1 million during the half year. NC margin per tonne grew by 2.4% from S$131 to S$134.

The relatively recession-resistant food category accounted for 77.6% of revenue and 83.2% of volumes. More importantly, this segment recorded strong NC growth of 32.1% and NC per tonne growth of 12.2% over the previous period. The Industrial Raw Materials (IRM) segment accounted for 22.4% of revenue and 16.8% of the volumes in H1 FY2012, registering volume growth of 7.4%. Due to very difficult trading conditions, NC in this segment declined 24% compared to the previous period.

Olam’s Group Managing Director and Chief Executive Officer Sunny Verghese said, “Our H1 FY2012 results reflect the resilience of the Olam model as we have continued to deliver positive operating results, even in periods of uncertainty and volatility in many global markets. The food and food-related segments of our business continue to demonstrate robust growth across businesses, geographies and value chain activities. This strong performance has helped to offset the results achieved in our industrial raw material business which is more recession-sensitive, and therefore continues to face demand and margin pressures.

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