Wilmar posts record net profits for 1H22 with 55.1% y-o-y jump

Singapore-based Wilmar International announced a 55.1% increase in net profits on the year for the first six months of 2022, with record net profit earnings of $ 1.165 billion on the back of improved performance across all key business units.

Revenue for the first half of 2022 period grew by 22% against last year to $36.13 billion, with core net profit increasing by 58% to $1.155 billion. The firm revenue was also supported by improved sales volumes in the Food Products and Feed and Industrial Products segments, particularly in Oilseeds and Grains.

The company’s Oilseeds and Grains segment saw a 6% y-o-y increase in sales volume in the first half of 2022, though the overall Feed and Industrial Products segment experienced a 5% drop. This was mainly attributed to lower sales of tropical oils and sugar during the period, which fell by 9% and 15% respectively.

“Results of the tropical oils business…was satisfactory, given the challenging operating conditions amidst frequent changes in palm oil related government policies during the period,” the company said.

Its Plantation and Sugar Milling segment fared better, with revenue from its oil palm plantation and sugar milling units rising by 70% and 5% on the year to $1.73 billion and $448.8 million respectively, following firm prices in both commodities.

In addition, fresh fruit bunch production rose by 3% to 2.13 million mt in the first half of 2022, with the improvement mostly seen from Indonesia due to better weather and crop profile.

Sales in its Food Products segment also grew by 4% to 13.8 million mt, with firmer demand for consumer products, particularly in China due to renewed lockdowns that occured in Q2 2022.

Looking ahead, Wilmar was optimistic that performance for the rest of the year will be satisfactory.

“The recent corrections in commodity prices will hopefully restore some of the demand destroyed by high prices and improve margins in the downstream business. At the same time, whilst palm oil prices have fallen from their peak in Q2 2022, they remain higher than the pre-Covid period, thus mitigating the effects on oil palm plantation performance,” Kuok Khoon Hong, Chairman and CEO of Wilmar said.