Wilmar

Wilmar: 2Q11 results largely in line.
Net profit was US$393m, +14% yoy, but flat qoq. Core net profit (excluding fair value loss on embedded derivatives of its convertible bonds and a profit in the sugar business relating to pre-acquisition hedging reserves) rose nearly 5% to US$404m from US$386m a year ago, and spot on consensus estimates.
Sales revenue rose 56% to US$10.56b from US$6.76b, on higher average commodity prices and consolidation of Sucrogen.
The co will pay an interim dividend of 3cts/sh down from 3.2cts last yr.

During the quarter, Wilmar's palm and laurics business recorded a 20% increase in pretax profit to US$153.1m. Sales volume declined by 3% to 4.8m mt due to uncertainties in the global economic environment but margins improved.
Plantations and palm oil mills business was the star performer, logging 89% growth in pretax profit to US$145m due to higher CPO and improved production of palm fruit.
Oilseeds and grains business pretax profit, however, declined 11% to US$129m despite a small growth in sales volume as the co imported higher quantities of soybeans in China, which crimped margins.

Mgt remains positive of its prospects, despite a challenging operating environment in China and uncertainties in the global economy. Asian economies will continue to see strong growth and the group expects to benefit from its integrated business model and its investments in new and existing businesses.
Separately, CFO Heng Hang Song Francis, will leave on Sep 30 to pursue personal interests.