Olam reports major profits growth for its global operations
Olam International has reported its latest annual figures, recording a 62% year-on-year increase in profits, to $564 million for its 2019 global operations.
Its earnings before tax also increased 25% to $1.6 billion, with an upturn in contributions from the majority of its business activities, including its confectionery ingredients divisions.
The company’s fourth quarter figures reflected the overall positive year, recording a major year-on-year increase of 316% to 313.4 million, and 219% growth for the period, at $229.7 million.
Its upturn in fortunes corresponds with a decision to split its global businesses into two main units, Olam Food Ingredients, providing a number of food sectors, including confectionery with major industry solutions, with its other main unit being Olam Global Agri, with key focus areas of food, feed and fibre supplies.
“We are pleased to have successfully completed the first year of our 2019-2024 Strategic Plan with all-round improved operational performance, execution of strategic initiatives and release of cash from targeted divestments. Building on our new Strategic Plan, we recently announced our plan to re-organise Olam into two new coherent operating groups – Olam Food Ingredients (OFI) and Olam Global Agri (OGA) to unlock and maximise the Company’s long-term value. Olam International, as the parent company of OFI and OGA, will play a key role in unlocking the full value of the Olam Group by providing stewardship to the new operating groups and building future growth engines.
“Even as we continue to monitor and mitigate the impact from the COVID-19 outbreak, we are confident that we have strong foundations in place to weather any short-term volatility and accelerate profitable growth in line with key consumer trends and market opportunities.”
Olam’s Group CFO, N. Muthukumar said: “Our proactive management of our capital structure continued to pay off, as we maintained a strong balance sheet and continued to deliver positive free cash flows despite investing S$1.1 billion of capex to execute our new Strategic Plan. We also continued to diversify our funding sources in 2019 through a mix of traditional and innovative channels, including the world’s first Digital Loan and a second sustainability-linked loan. Our commitment to sustainable financing gives us a clear advantage, builds resilience and enables us to catalyse positive change in our sector.”