Wilmar International reports Q4 net earnings of US$476.8M, down 4.7% from year-ago period, partly due to palm oil price declines, on sales up 0.9% to US$11.6B; company forming JV with Noble Group to develop, operate palm projects in Indonesia

Nevin Barich

HONG KONG , February 21, 2013 (Bloomberg LP) – Wilmar International Ltd., the world’s largest palm oil processor, said fourth-quarter profit dropped 4.7 percent after palm oil prices declined and it booked a lower gain on the value of its plantations.

Net income was $476.8 million in the three months ended Dec. 31, from $500 million a year earlier, the Singapore-based company said today in a statement. Sales increased 0.9 percent to $11.6 billion.

Wilmar today also said it’s forming a joint venture with Noble Group Ltd., Asia’s biggest listed commodity supplier by sales, to develop and operate palm projects in Papua, Indonesia. It recorded a $28.8 million gain on its plantations, from a $262.7 million gain a year ago, the company said.

“Most key segments delivered higher profit from operations in the fourth quarter, with the exception of plantations and palm oil mills, which was affected by lower crude palm oil prices,” Wilmar said in the statement.

The stock lost 1.6 percent to S$3.68 at the close in Singapore yesterday. The announcement today was made before the start of trading.

Palm oil, the most-consumed cooking oil, plunged 23 percent in 2012 as stockpiles expanded in Malaysia and Indonesia, while demand weakened.

Fourth-quarter profit, excluding non-operating items and biological asset gains, was $400.9 million, compared with $264.5 million a year earlier. That compares with the $412.2 million average estimate of four analysts surveyed by Bloomberg News.

Full-year net income fell 22 percent to $1.26 billion, beating the $1.1 billion average estimate of 21 analysts compiled by Bloomberg.

--Editors: Keith Gosman, Madelene Pearson

To contact the reporter on this story: Michelle Yun in Hong Kong at myun11@bloomberg.net

To contact the editor responsible for this story:at jrogers73@bloomberg.net

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