Wilmar International F34 has reported a core net profit of US$381.9 million ($509.9 million) for the 1QFY2023 ended March 31. The core net profit, which fell by 24.1% y-o-y, came in spite of the higher sales volume seen across the group’s businesses.
The results were deemed “satisfactory” by the group despite the uncertain macro-economic outlook at the start of the year.
Revenue fell by 3.8% y-o-y to US$16.91 billion.
Net profit fell by 26.2% y-o-y to US$391.4 million.
Ebitda fell by 12.4% y-o-y to US$970.6 million.
The group’s sugar milling and merchandising business “did well” with higher sugar prices. Oilseed crushing also performed better with higher sales volume and “good coverage of raw materials”.
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Food products saw higher sales volume on the back of higher medium pack and bulk products sales, particularly in China.
Wilmar’s plantation profit was “reasonable” though palm oil prices were down “significantly” from their peak. Shipping, too, “performed well” but the group’s palm oil refining margins during the quarter were “poor”.
The group also reported a higher share of profits from its investments in its associates and joint ventures (JV) during the quarter. According to its results, the higher share came from India and Europe in particular, as well as non-operating gains from its investment securities and lower effective tax rate.
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During the quarter, Wilmar reported cash flows from operating activities of US$2.17 billion, up from the negative cash flow of US$496.1 million in the same period the year before.
The group also saw its working capital requirements drop with the decline in commodity prices and seasonal reduction in overall inventory balance during the quarter. As a result, the group’s net debt fell by 7.9% y-o-y to US$17.27 billion.
Its net gearing ratio also improved to 0.84x as at March 31, compared to 0.94x as at Dec 31, 2022.
Looking ahead, the group says it is “cautiously optimistic” that its performance for the rest of the FY2023 will “remain satisfactory” with its diversified and integrated business strategies.
Shares in Wilmar closed 4 cents lower or 1.01% down at $3.93 on April 28.
