Wilmar’s earnings slip 8.7% to $1.49b in FY15

Due to mark-to-market losses, forex woes.

Forex woes and mark-to-market losses plagued Wilmar in FY15 as net profit for the year fell 8.7% YoY to US$1.06b (roughly $1.49b), and plunged 16% YoY to US$337.2m (about $474.13m) in Q4.

According to the company’s media release, core net profit also saw a decline, dipping 4.4% YoY to around US$1.67b for the year, and tumbled 15% YoY to US$350.4m in Q4. This is on back translation losses on back of weaker regional currencies against the USD.

The group’s Oilseeds and Grains as well as Sugar segments saw a strong quarter. The former enjoyed record volumes and healthy margins for the soybean crushing and Consumer Products businesses compared to the same period in FY14. Meanwhile, the Sugar division was bolstered by increased sugar prices during the quarter, partially offset by the translation effect from a weaker AUD.

However, the two segments’ performance were affected by Tropical Oil segment’s weak performance in line with the tough industry-wide conditions.

As a result, revenue for the year fell 10% to US$38.78, and plunged 12% YoY to US$9.43b in Q4, due mainly to reduced commodity prices but partially offset by strong sales volume growth. Total sales surged 10% to 65.3 million metric tonnes in FY15 and overall margins improved, despite challenges in the operating environment.

“In an environment where macro factors are expected to remain challenging, we believe our resilient business model and vertical integration, supported by our healthy balance sheet, will allow us to continue to do reasonably well,” stated Kuok Khoon Hong, Wilamr’s chairman and CEO.