Singapore's Wilmar posts 28% drop in Q4 2010 net profit

23 February 2011 02:51  [Source: ICIS news]

SINGAPORE (ICIS)--Wilmar International’s net profit fell 28% year on year to $318.6m (€232.6m) in the fourth quarter of last year, despite a surge in revenue, largely due to weaker performance in its oilseeds and grains segment, the Singapore-listed agribusiness firm said on Wednesday.

Revenue in the fourth quarter of 2010 rose 31.4% year on year to $9.1bn on the back of increased sales volumes and higher prices of agricultural commodities, the company said in a statement.

All business segments recorded stronger volumes in October-December, the statement said.

Poor margins from excessive imports of soybeans by the industry and the group’s “less timely” purchases of raw materials resulted in a pre-tax loss of $173.2m for the oilseeds and grains segment, it said.

For the full year of 2010, Wilmar’s net profit slumped 30% year on year to $1.32bn, primarily due to an exceptional gain from the sale of new shares in Wilmar China in 2009, the company said.

Revenue in 2010, meanwhile, grew 27.2% year on year to $30.4bn, it added.

Despite the weaker performance for the year, the group was optimistic of its performance in 2011, said Kuok Khoon Hong, chairman and CEO of Wilmar.

“Outlook of Asian economies, especially China, India and Indonesia, remains positive and commodity prices are expected to remain firm,” Kuok said.

“Notwithstanding the pressure on margins for [oilseeds] crushing and consumer products due to competition and high feedstock prices, together with [China] government restriction on price increase of consumer products, other segments of the group are expected to perform well,” he said.

“Refining and oleochemicals should benefit from expanded capacities, while plantations and fertilisers will benefit from higher palm oil prices,” Kuok added.

($1 = €0.73)

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By: Nurluqman Suratman

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