May 12, 2016
Wilmar's first quarter earnings up 3% to US$239 million
Wilmar International Limited, Asia's leading agribusiness group, registered a 3% increase in net profit to US$239.4 million for the first quarter of 2016 ended March 31.
The higher net profit in the period reflected steady performance from its Tropical Oils and Oilseeds & Grains businesses and an improved showing from Sugar.
However, weaker contributions from joint ventures and associates as well as one-off provisions for impairment of US$22.7 million made during the quarter resulted in lower overall core net profit. The Group's core net profit (excluding non-operating items) declined 12% to US$222.4 million.
Revenue declined 4% to US$9.0 billion due to lower commodity prices.
Oilseeds & Grains (Manufacturing & Consumer Products) saw pretax profit increase 2% to US$168.8 million in the first quarter. The increase was achieved on the back of volume and margin growth in Consumer Products and continued improvements from the Group's rice and flour operations. This was partially offset by lower crush margins due to excessive arrival of soybeans, despite an increase in crush volume.
Sales volume for Oilseeds & Grains Manufacturing registered a 13% increase to 5.5 million tonnes. Consumer Products sales volume grew 13% to 1.7 million tonnes.
"We expect the recent improvements in CPO (cost per order) prices to benefit our Plantation business. However, this will be partially offset by lower margins in our downstream businesses due to higher feedstock costs. Consumer Products will continue to achieve healthy growth although crush margins are expected to come under pressure as a result of excessive soybean arrivals into China in the coming months and amidst volatile markets," Kuok Khoon Hong, chairman and CEO of Wilmar, said.
