Wilmar International registered a 47.2 percent jump in revenue to US$44.7 billion while profit attributable to shareholders rose 20.9 percent to US$1.6 billion for FY11 ended 31 December 2011. Oilseeds and Grains segment contributed a strong 9.1 percent increase in sales volume for FY11 from a year ago. However, Palm and Laurics segment saw a decline in profits due to depressed margins caused by the unfavourable market conditions in China and India as well as negative impact from the European financial crisis.
Wilmar’s net income came in at US$500 million for 4Q11, which marked the highest quarterly profit since 3Q09, lifted by the expanded sugar operations which compensated for weakness in the core oil palm operations. However, the result is about 4 percent below analysts’ consensus of US$519.8 million, compiled by Bloomberg. The stock suffered a heavy sell down in the market open and was down 8.5 percent at 10:57am.
In a press release, chairman and chief executive officer Kuok Khoon Hong highlighted that the company focused on strengthening its businesses through continued investments in sugar, flour and rice milling, oleochemicals, biodiesel, oil refining and consumer products, despite the challenging global economic conditions in 2011. “We are also exploring closer collaborations with various parties in many of our businesses to meet the growing demand for agricultural products,” added Kuok.
Wilmar recommended a final ordinary dividend of $0.031 per share. FY11 dividend payouts totalled $0.061 a share, a 11 percent gain compared to $0.055 in FY10.
Wilmar’s performance stands out against other global agriculture companies which have seen their earnings hit in face of high commodity prices and tough trading environment. In view of its healthy balance sheet, it is well positioned to capture agri-related expansion opportunities that might arise this year.
On the same day of results release, the company announced a partnership with Archer Daniels Midland Company to engage in global fertiliser purchasing and distribution, global ocean freight operations, and tropical oils refining in Europe. The latter, a long-time partner of Wilmar, employs up to 30,000 staff globally, with more than 265 processing plants and 400 crop procurement facilities. The collaboration is an extension to the global stage on the back of Wilmar’s successful Asian operations with aid from Archer Daniels Midland Company.