Olam International posts one-time post-tax gain of $72m

It came from its various divestments, including its real estate assets in California.

Olam International recorded a net one-time post tax gain of about $72m arising from exceptional/one-off items in its unaudited financial statements for Q4 2019, a bourse filing revealed.

This came from the various steps it took under its 2019-2024 Strategic Plan, aiming to capitalise on key trends shaping the sector.

In Q4 2019, the company sold its real estate assets of its onion and garlic processing facility in California, its permanent water rights in Australia and its 10% stake in GSEZ SA, a subsidiary of Olam’s associate ARISE IIP. These transactions have generated a one-time post-tax capital gain of approximately $372m in the quarter..

Prior to this, Olam closed the sugar, rubber and fertiliser trading desks, fundamental fund and wood products businesses in Latin America. They also sold Olam Argentina S.A. and Collymongle Ginning. These are said to have reduced the company’s invested capital by $212.3m and generated a cumulative one-off loss of $17.8m till Q3 2019.

The firm has completed its review of restructuring and/or divestment actions for de-prioritised assets which were identified in its strategic plan including NZFSU (Uruguay), Olam Tomato Processors (USA), coffee plantations (Zambia, Brazil, Tanzania and Laos) and edible oils processing (Mozambique).

Overall, Olam recognises one-off exit costs, losses on disposal and/or impairment on these assets of approximately $300m in the financial statements for Q4 2019.