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UPDATE 1-Singapore's Wilmar posts Q2 profit; sees tropical oils improving in H2
August 10, 2017 / 10:50 AM / 2 months ago

UPDATE 1-Singapore's Wilmar posts Q2 profit; sees tropical oils improving in H2

* Q2 net profit $60.2 mln vs $220 mln yr-ago loss

* Q2 core net profit $37.3 mln

* Posts weaker performance in tropical oils, sugar segments (Adds outlook, milestone, CEO quote)

SINGAPORE, Aug 10 (Reuters) - Singapore’s Wilmar International Ltd turned in a profit in the second quarter as its oilseeds and grains segment recovered from losses in the year-ago period, although the results were hurt by weaker tropical oils and sugar businesses.

The company, whose biggest shareholders include U.S. agricultural trader Archer Daniels Midland Co, reported a net profit of $60.2 million for the three months ended June, versus a loss of $220 million a year earlier.

The world’s largest palm oil processor had posted its first ever quarterly loss in the April-June period last year, citing untimely purchases of soybeans. Excluding that loss, the net profit reported is the lowest in a decade.

It posted a core net profit, which excludes non-operating items of $37.3 million, versus a loss last year.

Its tropical oils business reported a 68 percent fall in pretax profit to $59.5 million, while the pretax loss in its sugar business widened to $106.8 million. The sugar business will continue to be affected by volatility in prices, Wilmar said.

The oilseeds and grains segment posted a pretax profit of $61.1 million, benefitting from higher crush volume and positive margins, versus year-ago loss of $343.8 million.

The company said it expected the tropical oils business to perform better in the second half due to improvements in production yields and better margins from downstream operations.

Oilseeds crush margins are expected to remain positive for the rest of the year and consumer products will improve as it enters its seasonal peak period, it said.

“While the group may face short term challenges, we remain very optimistic about the tremendous growth prospects of our various businesses and will continue with our expansion plans, especially in China, India and Indonesia,” Kuok Khoon Hong, chairman and CEO, said in a statement.

The company’s shares, valued by the market at about $16 billion, closed flat ahead of the results.

In May, Wilmar said it was evaluating a separate listing of its operations in China, its biggest market by revenue. It had then said any offering proposal would be at least 18 months away. (Reporting by Aradhana Aravindan,; Additional reporting by Patturaja Murugaboopathy; Editing by Vyas Mohan)

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