WILMAR International's first quarter profit grew 3.2 per cent despite a drop in revenue, as cost of sales fell even more.
The palm oil processor recorded net profit of US$239.4 million for the three months ended March 31, up from US$232 million a year ago. This translates into earnings of 3.8 US cents per share, up from 3.6 US cents the same period last year.
Revenue slipped 4.3 per cent to US$9 billion on lower commodity prices.
Looking ahead, the company said it expects higher crude palm oil prices to benefit its plantation business, but at the same time, the higher feedstock costs will lead to lower margins in its downstream businesses.
It also expects its consumer products division to achieve "healthy growth", although crush margins will come under pressure due to an excessive amount of soybean being shipped into China in the coming months.
"Operating conditions in the second quarter are expected to be challenging," said Wilmar CEO and chairman Kuok Khoon Hong.