Halcyon Agri has reported earnings of US$1.0 million ($1.39 million) for the 1HFY2022 ended June, 37.3% higher than the earnings of US$759,000 in the same period the year before.
After adjusting for the US$3.8 million dividend on perpetual securities, the group actually reported an adjusted loss of US$2.8 million.
As a result, loss per share stood at 0.17 US cents on a diluted basis.
Revenue for the period increased by 12.1% y-o-y to US$1.29 billion due to higher sales volume and higher revenue per tonne.
Cost of sales increased by 11.7% y-o-y to US$1.21 billion in line with the increase in volume.
Gross profit increased by 17.6% y-o-y to US$85.9 million mainly due to the higher sales volume and gross profit per tonne.
Operating profit surged over three times to US$26.6 million from US$8.8 million in the same period the year before.
Profit before tax surged around 49.8 times to US$12.1 million from US$242,000 previously due to higher other income on the disposal of non-core properties in the 1HFY2022 as compared to gain on disposal of a subsidiary of US$7.6 million in the 1HFY2021.
During the same period, the group netted a positive foreign exchange movement of US$1.7 million.
Finance income fell by 25.9% y-o-y to US$2.5 million.
Finance costs increased by 38.2% y-o-y to US$16.7 million.
During the half-year period, Halcyon Agri recorded a share of loss of US$344,000 from its associates as opposed to a gain of US$185,000.
Income tax expense also surged to US$7.8 million from US$37,000 previously.
As at June 30, cash and cash equivalents stood at US$49.9 million.
Looking ahead, the group is expecting inflationary pressures to remain in the near term amid the ongoing geopolitical events.
As a result, it also expects market activity to slow down in the near future as a result of the possible recession.
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In its outlook statement, the group adds that the raw material supply situation “remains challenging at a few key origins due to an extended period of under-investment”.
No dividend has been declared for the period.
“Throughout 1HFY2022, the global economy has been affected by multiple factors ranging from geopolitical tensions, inflationary pressures, rising oil and gas prices, Covid-19 lockdowns in China to volatilities in equities and commodities markets,” says Halcyon Agri’s CEO Li Xuetao.
Despite the challenges, Li believes the group has done “reasonably well”.
“We displayed operational resilience and improved our overall profitability. At the same time, we continue to improve our working capital liquidity, to cater for the improving demand situation,” he adds.
Shares in Halcyon Agri closed at 21.5 cents on Aug 12.