Olam International has reported FY2020 operational PATMI of $667.8 million up 36% over the preceding year, on the back of a 8.6% growth in revenue to $35.8 billion in the same period.
However, due to an impairment of $483.9 million at its Olam Palm Gabon, the company’s earnings for the year ended Dec 31 2020 was down 22.3% to $245.7 million.
The company’s co-founder and group CEO Sunny Verghese is seeing better market conditions on recovery from the pandemic, with sentiments improving and economies “snap back”. “We expect this favourable market environment to continue to improve in 2021,” he says.
The company plans to pay a final dividend of four cents per share, which would bring FY2020 total to 7.5 cents, versus 8 cents paid for FY2019.
Separately, the company is mulling the separate listing of Olam Food Ingredients by first half of 2022.
This follows the re-organisation started early last year by the company into two “coherent” groups, to better capture markets and trends. Besides Olam Food Ingredients, the other new unit is called Olam Global Agri.
Olam shareholders will receive shares of OFI in specie at the point of demerger. Similar “strategic options” is being explored for OGA.
“OFI is a truly global business and its independent listing is a critical first step in unlocking its longterm value,” says Verghese.
“At the same time, we continue to explore strategic options for OGA to unlock further value for the group, while maintaining the listing of our holding company in Singapore,” he adds.
Olam International shares closed Feb 25 at $1.63, down 1.21%.
