Company expects a loss in Q3, but full-year results to remain profitable

 

[SINGAPORE] Despite a verdict from the Indonesian Supreme Court requiring Wilmar International to pay five billion rupiah (S$387,047) worth of fines and a compensation of 11.9 trillion rupiah on corruption charges, the Singapore-based palm oil company has maintained its expectations of a full-year profit.

 

This comes as Kuok Khoon Hong, chairman and chief executive of the company, scooped up S$2.7 million worth of shares through entities linked to him on Friday (Sep 26). 

 

In an announcement on Friday, Wilmar said that it expects to post a net loss for its third quarter ending Sep 30, following penalties imposed by the court. In addition to the 11.9 trillion rupiah confiscated by Indonesia&rsquo s Attorney-General&rsquo s Office, five Wilmar subsidiaries charged &ndash namely Multimas Nabati Asahan, Multi Nabati Sulawesi, Sinar Alam Permai, Wilmar Bioenergi Indonesia and Wilmar Nabati Indonesia &ndash will be required to pay a fine of one billion rupiah each.

 

However, the company still expects to turn a profit for the full year ending Dec 31, it noted.

 

A separate filing by the company on Friday revealed that three entities &ndash HPRY Holdings Ltd, Longhlin Asia Ltd and Hong Lee Holdings &ndash had each acquired shares at S$2.838 apiece, amounting to a total of 945,200 shares worth S$2.7 million. 

 

Kuok is deemed an interested party in these entities. The acquisition thus means that the Singaporean now holds more than 896 million shares, or a 14.4 per cent stake in Wilmar.

 

After the court&rsquo s announcement on Thursday, Wilmar&rsquo s shares dropped as much as 3.8 per cent to S$2.78 in intra-day trading on Friday &ndash the stock&rsquo s lowest price since January 2016. 

 

Indonesia&rsquo s Supreme Court had overturned the company&rsquo s previous acquittal in a graft case involving cooking oil export permits during the 2021-2022 shortage crisis.

 

Wilmar, along with two Indonesian palm oil companies Permata Hijau and Musim Mas, had been accused of illegally profiting from the evasion of state-imposed export controls on cooking oil and palm oil.

 

Wilmar found guilty of corruption as Indonesia&rsquo s Supreme Court overturns previous acquittal

The company noted that it regrets, but respects, the court&rsquo s decision. &ldquo The actions taken by the Wilmar respondents, during the period of a shortage of cooking oil in the Indonesian market, were done in compliance with prevailing regulations and in good faith,&rdquo said Wilmar.