Wilmar International Reports 39.4% Fall in Net Profit
Financial Performance
Wilmar International, a leading agribusiness, reported a 39.4% fall in net profit to US$590.2 million for the six months ended December 2024. The decline was attributed to the absence of a US$231 million gain in the year-ago period from the disposal of its Moroccan associate Cosumar, as well as a US$22.8 million net loss from a share swap exercise involving its China associates and joint venture Luhua.
Core Net Profit
The company’s core net profit, which excludes contributions from joint ventures and associates, as well as non-operating gains from investment securities, was down 43.6% at US$558.2 million.
Revenue Growth
Despite the decline in net profit, revenue for the half-year rose 5.3% to US$36.4 billion on stronger sales volumes. The company’s food products business saw an 8% increase in turnover, while the feed and industrial products segment reported a 15% rise.
Challenges
The company faced challenges in its sugar merchandising business, which was weaker than expected. Additionally, the tropical oils business was affected by challenging conditions. The plantation and sugar milling segment, however, saw a 4% increase in pre-tax profit to US$215.3 million, excluding the US$231 million gain from the disposal of Cosumar.
Full-Year Performance
For the full year, Wilmar’s revenue inched up 0.3% to US$67.4 billion. Net profit fell 23.3% to US$1.2 billion, while core net profit was down 25.7% at US$1.6 billion.
Outlook
Looking ahead, the company’s chairman and CEO, Kuok Khoon Hong, expects Wilmar to increase its market share in the food products segment, with a focus on "quality and healthy food." He is also "cautiously optimistic" that the oilseeds business will perform satisfactorily, driven by a record soybean crop production in Brazil this year.
FAQs
Q: What was the reason for the decline in Wilmar’s net profit?
A: The decline was due to the absence of a US$231 million gain in the year-ago period from the disposal of its Moroccan associate Cosumar, as well as a US$22.8 million net loss from a share swap exercise involving its China associates and joint venture Luhua.
Q: How did the company’s revenue perform in the half-year?
A: Revenue for the half-year rose 5.3% to US$36.4 billion on stronger sales volumes.
Q: What were the challenges faced by the company’s sugar merchandising business?
A: The sugar merchandising business was weaker than expected, partially offset by losses in its new food product ventures.
Q: What is the company’s outlook for the full year?
A: The company expects to increase its market share in the food products segment, with a focus on "quality and healthy food." It is also "cautiously optimistic" that the oilseeds business will perform satisfactorily, driven by a record soybean crop production in Brazil this year.
