Singapore conglomerate Olam International has posted a fall in annual profits but sales volumes and margins from its food business continued to grow.

The company yesterday (28 August) booked a 4.6% decline in underlying net profit to S$355.5m (US$283.6m) for the year to the end of June. Olam suffered from volatility in the cotton sector and slowing demand for its wood products in China.

However, it said its food business reported “strong volume and margin growth” during the year.

Olam’s food business, which accounts for the bulk of its sales and profits, is made up of three operations – edible nuts, spices and beans; confectionery and beverage ingredients; and food staples and packaged foods.

Food volumes increased 31.5%, Olam said, helping the company to report a 12.7% gain in revenue to S$17.1bn.

In June, Olam expanded its packaged food business in Africa with the acquisition of Nigerian dairy group Kayass. Click here for our BRICs and beyond column on the deal and Olam’s plans to increase its food production in the country.