Olam reports 9.8% rise in 1Q18 earnings to $158 mil on lower finance costs and tax expenses

Olam reports 9.8% rise in 1Q18 earnings to $158 mil on lower finance costs and tax expenses

By: 
PC Lee
14/05/18, 07:58 am

SINGAPORE (May 14): Agri-business group Olam International, which grows, trades and processes food and industrial raw materials, reported a 9.8% rise in 1Q18 earnings to $158 million from $143.8 million a year ago on reduced net finance costs and lower taxation.  

Sales of goods and services rose 8.5% to $6.3 billion from $5.8 billion a year ago while other income more than doubled to $30 million and finance income more than trebled to $22.3 million.

Share of results from jointly controlled entities and associates more than quadrupled to $12.3 million.

Other expenses increased 58.2% to $332.6 million while finance costs narrowed 25.1% to $109.7 million.

Revenue from Edible Nuts, Spices & Vegetable Ingredients fell 4% at $874.5 million, mainly on reduced volumes in peanuts while EBITDA fell 1.6% to $135.8 million compared with a strong set of results for 1Q17.

Revenue from Confectionery & Beverage Ingredients decreased 10.5% to $1.9 billion on lower volumes and lower prices. EBITDA declined 18.4% to $61.2 million due to significantly lower contribution from coffee in 1Q18.

Revenue from Food Staples & Packaged Foods increased 34% to $2.6 billion, mainly on higher trading volumes in Grains but EBITDA declined 15.1% to $100.4 million when compared with a very strong 1Q17.  

Revenue from Industrial Raw Materials, Ag Logistics & Infrastructure rose 9.1% to $903.4 million on higher cotton volumes and prices while EBITDA improved 6.4% to $66.2 million on higher contribution from Cotton and Gabon Special Economic Zone.

Operational PATMI, which excludes exceptional items, grew 13% to $162.6 million from a year ago.

Net gearing as at March 31 was lower at 1.49 times compared to 1.98 times as at March 31 due to lower net debt from the reduction in working capital, lower gross capital expenditure, divestments and the conversion of warrants into equity.

While global markets continue to experience political and economic uncertainties, Olam believes its diversified and well-balanced portfolio provides a resilient platform to navigate the challenges in both the global economy and commodity markets.

Olam says it will also continue to focus on turning around underperforming businesses.

Shares in Olam closed 1 cent higher at $2.30 on Friday.

US sanctions on Huawei could backfire

SINGAPORE (May 27): It was only to have been expected. After nearly a year of pressure that failed to stop Huawei Technologies Co’s expansion -- especially in the rollout of the next generation 5G wireless network globally -- in its tracks, US President Donald Trump signed an executive order effectively barring American firms from doing business with the Chinese telecommunications equipment company. The inclusion of Huawei on the US Department of Commerce’s Bureau of Industry and Security’s (BIS) Entity List means that companies would need to apply for a waiver to supply goods with 25....
Read More >>

Annica chairman Ong quits just as $33 mil goes missing at his law firm JLC

SINGAPORE (May 27): Jeffrey Ong, managing partner of law firm JLC Advisors, may have given instructions to pay out a sum of $33.2 million held in escrow by his firm for a client, Allied Technologies. According to Allied’s statement filed with Singapore Exchange on May 23, the payment may have been “unauthorised”, citing a letter it received from JLC on May 22. Allied’s statement did not specify who the payment was made to. Ong also abruptly resigned as non-executive chairman of Annica Holdings on May 20. In a May 22 filing with SGX, Annica CEO Sandra Liz Hon Ai Ling said Ong resigne....
Read More >>

SGX RegCo sees targeted approach in enforcement, more powerful market discipline

SINGAPORE (May 27): Tan Boon Gin, CEO of stock exchange regulator Singapore Exchange Regulation, says the market can expect a stronger regulatory presence. “You will see a series of enforcement cases coming up quite soon,” he tells The Edge Singapore. Tan’s assertion comes amid significant changes in the market as sentiment remains lacklustre and investors’ expectations change. The local stock market has gone through significant upheaval, not least because of the penny stock crash in 2013 that wiped out some $8 billion in value from the market. The event dented investor sentiment, a....
Read More >>