Wilmar net profit declines on palm & laurics
August 8, 2014
by World Grain staff
SINGAPORE — Wilmar International Limited, one of Asia’s leading agribusiness groups, on Aug. 7 reported net profit for the second quarter ended June 30 of $170.7 million, which represents a 22% decline from $218.5 million for the same period last year. Excluding non-operating items, Wilmar registered a drop of 34% in net profit to $163.1 million in the second quarter.
Wilmar said that its lower net profit in the second quarter was mainly due to margin contraction in Palm & Laurics and losses from associates.
The Oilseeds & Grains segment registered a 22% increase in sales volume to 5.5 million tonnes. The segment turned around from the losses in the first quarter of 2014 and recorded a pretax profit of $4.1 million as crush margins recovered.
Wilmar said its Consumer Products and Plantations & Palm Oil Mills segments continued to perform strongly. Sugar results improved due to higher contributions from Merchandising & Processing, which mitigated the higher seasonal losses in Milling.
Revenue for the quarter increased marginally to $10.52 billion. Higher sales volume in Oilseeds & Grains and higher palm prices were offset by lower sales volume in Sugar.
Wilmar’s net profit for the first half of the year ended June 30, decreased 38% to $332.5 million, while revenue increased marginally to $20.79 billion. Net profit excluding non-operating items declined 33% to $377.6 million.
“Lower prices due to improved global oilseed supplies, less excessive imports of beans into China and higher seasonal demand in the second half of the year should further improve crush margins in the coming months,” Mr. Kuok Khoon Hong, chairman and chief executive officer of Wilmar, said. “Consumer Products, with its wide product portfolio, should continue to grow across all our markets. As we enter into the traditional peak season, Plantations & Palm Oil Mills should report better contributions. Increased supply of CPO will help to improve Palm & Laurics performance even though operating conditions will remain challenging. Barring any bad weather in the coming months, Sugar will contribute positively with the commencement of the crushing season in June. Overall, we expect much better performance in the second half of the year.”