It was pushed by the strong performances of oilseeds and grains and tropical oils segments.
Wilmar International’s profit ballooned 436.6% to US$316.4m in Q2 2018 from US$59m in Q2 2018 buoyed by solid performance from the oilseeds and grains and tropical oils segments, paired with better contributions from the group’s associates, an announcement revealed.
The firm’s Q2 revenue advanced 1.9% YoY to US$10.7b due to higher sales volume and commodity prices from the oilseeds and grains businesses. However, the gains were partially offset by lower commodity prices in both the tropical oils and sugar segments.
For H1 2018, Wilmar saw a 29.6% jump in profits to US$519.7m from US$400.9m a year ago. Its revenue grew 3.8% to US$21.97b in H1 from US$21.17b a year ago.
The firm reported that its tropical oils segment’s pretax profit surged 165% YoY to US$154.9 m in Q2 2018 as it was pushed by better performances from their midstream and downstream businesses.
Meanwhile, the oilseeds and grains segment recorded a 381.3% surge in pre-tax profit to US$290.2m in Q2 from US$60.3m a year ago as it was backed by higher volume and good crush margins and a good performance from the Consumer Products business.
“The trade tensions between the US and China improved crush margins in the short term, thus benefiting our oilseeds crushing business,” Wilmar International CEO and chairman Kuok Khoon Hong said. “However, a prolonged dispute between the two countries will have a negative impact on crush margins due to lower plant utilisation.”
From its joint ventures and associates, Wilmar garnered US$49.6m which is up 113.79% from US$23.2 million a year ago. The contributions mainly came from China and Europe.
Kuok believes that other business segments outside oilseeds such as consumer products, rice and flour milling will fare well in the coming quarters despite the trade wars.
“Whilst sustained low palm oil prices will affect our plantation business, our downstream businesses will benefit from increased demand and better margins for its products,” he noted. “Sugar performance should also improve in the second half of the year, with the commencement of crushing season in June.”
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