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Wilmar Q3 profit slips as weak equity market causes investment loss
[SINGAPORE] Wilmar International, the world's largest palm oil processor, said on Wednesday that its third-quarter net profit dropped 35 percent on the year, as mark-to-market losses from investment securities more than offset strong performance in oilseeds and grains.
Wilmar, part of the influential Kuok Group, reported a quarterly net profit of US$275.9 million, on a revenue of US$10.6 billion, which shrank 7.6 per cent on the year.
Non-operating items recorded a loss of US$78.9 million, widening from US$5 million a year earlier, mainly due to higher losses in investment securities due to weaker equity markets during the quarter. However, the company had recovered nearly a third of the losses in October, it said.
Low palm oil prices as well as low refining margins weighed on the group's plantation business, but higher volume and better margins in its soybean crushing and consumer products businesses boosted the oilseeds and grains segment despite a slowdown in the Chinese market, the company said.
"The group expects performance of oilseeds and grains segment to remain satisfactory," the company said in the statement, adding that the recent increase in crude palm oil prices would improve margins in its plantation business, and a recent surge in sugar prices would help its sugar business.