Wilmar International, the agribusiness giant set to buy Australia’s Goodman Fielder, has booked lower sales but higher profits from its existing consumer business in the first nine months of the year.
The Singapore-based group’s consumer arm predominantly sells edible oil and rice. It reported a 4.3% fall in revenue from the division to US$5.37bn for the nine months to the end of September.
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The decline in sales was steeper in the third quarter, with revenue dropping 10.5% to $1.85bn.
Despite the lower sales, pre-tax profits from the unit jumped 26.9% to $183.5m. Third-quarter pre-tax profits from the division were up 28.9% at $75.1m.
Lower selling prices weighed on Wilmar’s consumer products sales in the first nine months of the year. Volumes were up 7.1% on the back of “good growth” outside China and stronger demand for the company’s edible oils and rice products in the first half of the year.
A fall in feedstock costs also helped Wilmar’s margins, it said.
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By GlobalDataFor the period to 30 September, group pre-tax profits fell 21.3% to $995.6m with tumbling earnings from Wilmar’s palm oil and sugar divisions. Net profit was down 20.5% at $755m.
Revenue dipped 0.5% to $32.31bn, with sales from sugar dropping 11.2%.
Wilmar is set to expand its interest in consumer foods through the acquisition of Goodman Fielder. In July, Goodman Fielder, the manufacturer of brands including Meadow Lea butter and Helga’s bread, approved a A$1.32bn (US$1.13bn) bid for the business from Wilmar and Hong Kong investment firm First Pacific.
Shareholders in Goodman Fielder are set to vote on the takeover in the first quarter of next year.
