HALCYON Agri Corporation : 5VJ 0% posted an operating loss of US$2.2 million for its third quarter ended Sep 30, 2022, compared to the operating profit of US$0.7 million a year earlier.

 

Core earnings before interest, taxes, depreciation, and amortisation (Ebitda) was at US$10.2 million, up year on year from US$9.4 million in Q3 2021, but down quarter on quarter from US$16.2 million in Q2 2022.

 

Meanwhile, gross profit for the period was up 13.3 per cent on-year to US$39.1 million, while revenue rose 17.9 per cent on-year to US$709.8 million, said the natural rubber supplier on Monday (Nov 21).

 

The company noted that its sales volume for the quarter rose to 394,684 metric tonnes, from 330,474 metric tonnes from a year earlier, which it attributed to its &ldquo timely capture of market demand through its global pole position and vertically integrated capabilities&rdquo .

 

A recent decline in rubber prices had resulted in &ldquo some level of margin compression&rdquo in its plantation and processing businesses.

 

But this was offset by a stronger performance in its distribution business in destination markets, the company said.

 

Li Xuetao, chief executive of Halcyon Agri, said the company remains &ldquo encouraged and cautiously optimistic on our prospects in the remaining months&rdquo of 2022.

 

He said: &ldquo The recent interest rate increases by the US Federal Reserve will inevitably affect global demand, but this could be offset by the resurgence of demand upon China&rsquo s reopening.&rdquo

 

Last Wednesday, Shanghai Stock Exchange-listed China Hainan Rubber Industry Group said it will acquire 574.2 million shares in Halcyon Agri at US$0.315 apiece, for a total cash consideration of US$180.9 million.

 

This represents a 36 per cent stake in Halcyon Agri the share purchase will also trigger a mandator general offer (MGO) for the Singapore-listed company.

 

Li noted that the company&rsquo s businesses will operate as usual while the share purchase and MGO takes time.

 

&ldquo Halcyon Agri views this transaction positively, as it can further augment our position as the leading integrated supply chain manager,&rdquo he added.