Wilmar Q3 net profit falls 59% to US$313.9 million

WILMAR International’s net profit for the third quarter ended Sep 30, 2023 fell 59 per cent to US$313.9 million, from US$766.2 million in the year-ago period.

Its core net profit also fell by similar margins, due to compressed refining margins from the tropical oils business and weaker performance by its fertiliser operations, it said in a bourse announcement on Thursday (Oct 26). This was partially offset by continued strong performance from its sugar milling and merchandising businesses and improved crushing margins arising from tightness in soybean availability in China, it added.

Revenue in Q3 slipped by a smaller margin of 6.4 per cent, to US$17.7 billion, from US$18.9 billion in Q3 last year.

Meanwhile, falling palm oil, oilseeds and grains prices led to lower net working capital requirements for the group and net debt fell to US$16.9 billion as at Sep 30, 2023. It was previously US$18.8 billion in FY2022. Net gearing ratio also improved to 0.88 times, from 0.94 in FY2022.

Wilmar noted that operating conditions in China were better in Q3 this year and believes it will likely remain positive for the rest of the year. Its sugar merchandising, milling and refining business will also remain “good” with higher sugar prices while tropical oils refining margins will continue to normalise after exceptional conditions last year, it added. “Barring unforeseen circumstances, we believe results for the rest of the year will be satisfactory,” said the company.

Shares in Wilmar gained 0.6 per cent or S$0.02 to S$3.47 on Thursday before the announcement.