Wilmar Profit Rises 18% in Q2 Despite Commodity Woes

06 Aug 2015 --- Wilmar International Limited, Asia’s leading agribusiness group, achieved an 18% increase in net profit to US$201.8 million for the quarter ended June 30, 2015. The Group’s core net profit (i.e. excluding non-operating items) grew 19% to US$193.6 million in 2Q2015. The higher net profit in 2Q2015 reflected a strong performance from Oilseeds & Grains compared to 2Q2014.

However, Tropical Oils turned in a lower profit in 2Q2015 due to lower crude palm oil (CPO) prices while Sugar saw weaker performances amidst tougher operating conditions. Revenue for the quarter declined 12% to US$9.28 billion, mainly due to lower commodity prices.

The Group’s net profit for the half year ended June 30, 2015 (“1H2015”) increased 33% to US$443.0 million, while revenue fell 10% to US$18.70 billion. Core net profit grew 21% to US$457.0 million in 1H2015.

Tropical Oils (Plantation & Manufacturing) posted a 15% drop in pretax profit to US$176.0 million in 2Q2015 mainly due to lower CPO prices. Production of fresh fruit bunches grew 3% to 1,155,431 metric tonnes (“MT”). Production yield improved 6% to 5.5 MT per hectare. Sales volume from Tropical Oils Manufacturing declined 6% to 5.6 million MT in 2Q2015.

Oilseeds & Grains (Manufacturing & Consumer Products) saw pretax profit surge from US$41.5 million to US$115.9 million in 2Q2015. The strong growth was driven by improved crushing margins, higher volume crushed and continued robust performance in Consumer Products. Sales volume for Oilseeds & Grains Manufacturing registered a 21% increase to 5.9 million MT. Consumer Products sales volume declined 12% to 1.0 million MT due to the reclassification of packed palm oil from Consumer Products to Tropical Oils segment. Without this reclassification, Consumer Products’ volume would have seen an increase of 6%.

Sugar (Merchandising, Manufacturing & Consumer Products) reported a higher pretax loss of US$37.5 million compared to a pretax loss of US$23.7 million in 2Q2014. This was due to weaker performances from the Group’s merchandising and manufacturing business and seasonal losses in Milling which are typically incurred as a result of plant maintenance in the first half of the year. Sales volume for Sugar increased 48% to 2.3 million MT from higher merchandising activities.

The Others segment recorded a pretax profit of US$31.9 million in 2Q2015 compared to a pretax profit of US$17.4 million in 2Q2014, mainly due to stronger contributions from both Shipping and Fertiliser businesses as well as higher investment gains. Associates recorded a pretax loss of US$10.3 million compared to a pretax loss of US$4.0 million in 2Q2014, mainly due to losses from the Group’s Sugar investments in India. This was partially offset by higher contributions from associates in China.