Singapore’s Olam International, one of the world’s biggest traders of rice, coffee and cocoa, posted flat annual core earnings, hampered by weaker sales in the latest quarter as the company exited or downsized businesses.
The commodities trader reported earnings before interest, tax, depreciation and amortisation (EBITDA) of $1.17 billion for the year ended June 30, down 0.2% and less than a consensus estimate of $1.23 billion from analysts polled by Thomson Reuters I/B/E/S.
For the fourth-quarter, EBITDA fell 8.8%, hurt in part by its lower revenue base. As part of a wide restructuring effort in the last financial year, Olam scaled down a cashew processing facility in Nigeria and exited a rice business in Cote d’Ivoire as well as some grains trading businesses in Australia and South Africa.
Sales and margins for its business in Ukraine also came under pressure due to tensions with Russia.
“The flat EBITDA on the year shows that the company hasn’t gone anywhere on the operational level despite all the effort that has been put in,” said Adrian Foulger, an analyst at Standard Chartered.
Full year net profit for Olam, in which Singapore’s state investor Temasek Holdings indirectly controls a 58.5% stake, jumped 68% to $608.5 million on one-off gains.
The company recommended a cash dividend of 5 cents per share for the year, as well as a special dividend of 2.5 cents per share.
No comments:
Post a Comment