Wilmar International Limited (WIL) made a dismal start to FY14, with reported net profit tumbling 49% YoY and 56% QoQ to US$161.8m, hit by negative soybean crush margin and lower demand for soybean meal; also higher seasonal losses in its Sugar business. Excluding exceptional items, core earnings came in around US$215m, still down 32% YoY and 39% QoQ, meeting just 15% of our FY14 forecast. Revenue of US$10,268.6m (+1% YoY but down 12% QoQ) met 22% of our full-year forecast. And with China’s economy still looking somewhat uncertain, we place our Buy rating and S$3.65 fair value under review, pending an update from management later.

Source: OCBC Research - 9 May 2014