Wilmar International

[Fish Head]

The debt are mostly trade financing that back by the commodity. It is different with a bank loan for property development.

The concerning rather comes from the decreasing ROE over the years.

[VIChris]

The debt are mostly trade financing that back by the commodity. It is different with a bank loan for property development.

The concerning rather comes from the decreasing ROE over the years.

Hahaha, finally someone talk sense on this company debt.
Your are correct.

Those who don't understand this company mode of operation and its business model just talk nonsense.

[BlueKelah]

In any case, debt is still debt. Whether its backed by commodities or property assets it's still debt which attracts a certain interest payment. 

Decreasing ROE means decreasing net income, assuming equity is roughly the same. Of course the commodity downturn has impacted income, however increasing finance cost of debt will also impact net income and so impact ROE. Imagine how much more needs to be paid if interest rates increase 1% and the impact on ROE.

those who gamble on high debt companies can either end up very rich or very poor.

caveat emptor.

[VIChris]

In any case, debt is still debt. Whether its backed by commodities or property assets it's still debt which attracts a certain interest payment. 

Decreasing ROE means decreasing net income, assuming equity is roughly the same. Of course the commodity downturn has impacted income, however increasing finance cost of debt will also impact net income and so impact ROE. Imagine how much more needs to be paid if interest rates increase 1% and the impact on ROE.

those who gamble on high debt companies can either end up very rich or very poor.

caveat emptor.

You still don't understand how Wilmer operate and what is trade financing.
More than half of her debts is due to trade financing. Trade financing grows and shrinks in proportion to commodity prices as the financing is solely used for working capital. Trade financing in simple term, a tool used to minimize credit risks between importers and exporters.
These loans are relatively cheap (0.5-1% p.a.) in short-term.

Well, I will stop here and leave the rest to find out the true value of this company. Don't just touch on the surface without realizing whether this is a gem or your so called high risk company.

Cheers

[weijian]

Wilmar pursues China prospects with renewed listing plan

[SINGAPORE] Singapore's Wilmar International Ltd, which is considering spinning off its China business, is looking to list it in Shanghai to boost its profile on the mainland and potentially pave the way for deals. China is Wilmar's biggest market, accounting for nearly 50 per cent of 2016 revenues of US$41.4 billion for one of the world's largest edible oil processors. Its annual revenues from China have risen about 50 per cent since 2009. Wilmar said in Thursday's earnings statement it was carrying out an "internal restructuring" of those operations. It confirmed on Friday that that would mean reviving a listing plan first aired in 2009, but swapping the venue to Shanghai from Hong Kong.

http://www.businesstimes.com.sg/companie...sting-plan

[cyclone]

Lion Corporation and Wilmar to form Joint Venture

Wilmar International Limited announced that its wholly-owned subsidiary, KOG Investments Pte Ltd (“KOGI”), has entered into a conditional joint venture agreement with Lion Corporation today for the manufacture and sale of methyl ester sulfonate.

Pursuant to the JVA, KOGI will incorporate an investment holding company (“JV Company”) in Singapore, which, in turn, will incorporate an operating company in Indonesia. The Operating Company will acquire the Wilmar group’s existing MES manufacturing facilities in Indonesia. JV Company will also acquire Lion Eco Chemicals Sdn. Bhd. (“LECO”), in consideration for the issue of 50% of the enlarged share capital of JV Company at a subscription price equivalent to LECO’s fixed asset value.

Lion Corporation, which is listed on the Tokyo Stock Exchange, is engaged in the manufacture and sale of toothpaste, toothbrushes, soaps, detergent, hair- and skin-care products, cooking-related products, and pharmaceuticals.

[touzi]

In any case, debt is still debt. Whether its backed by commodities or property assets it's still debt which attracts a certain interest payment. 

Decreasing ROE means decreasing net income, assuming equity is roughly the same. Of course the commodity downturn has impacted income, however increasing finance cost of debt will also impact net income and so impact ROE. Imagine how much more needs to be paid if interest rates increase 1% and the impact on ROE.

those who gamble on high debt companies can either end up very rich or very poor.

caveat emptor.

You still don't understand how Wilmer operate and what is trade financing.
More than half of her debts is due to trade financing. Trade financing grows and shrinks in proportion to commodity prices as the financing is solely used for working capital. Trade financing in simple term, a tool used to minimize credit risks between importers and exporters.
These loans are relatively cheap (0.5-1% p.a.) in short-term.

Well, I will stop here and leave the rest to find out the true value of this company. Don't just touch on the surface without realizing whether this is a gem or your so called high risk company.

Cheers

Hope you can help clear my doubts. Is the trade financing for Wilmar to buy commodities from it's supplier? So when Wilmar receive the goods, it will still have to pay the supplier with its own cash? Thanks.

[cyclone]

Wilmar co-founder Martua Sitorus resigns amid deforestation scandal

By: Samantha Chiew
04/07/18, 01:15 pm

SINGAPORE (July 4): Wilmar International’s co-founder, Martua Sitorus, has tendered his resignation a week following Greenpeace International's revelation of his links to Gama Plantation, a related palm oil business responsible for massive deforestation in Indonesia.

Gama is a palm oil business run by senior Wilmar executives and members of their family.

In addition, Sitorus’ brother-in-law, Hendri Saksti, who is the group’s country head for Indonesia has also resigned.

Wilmar in 2013 has committed to end its links to deforestation. But Greenpeace investigations revealed that Gama has deforested an area that came up to twice the size of Paris.

More details in https://www.theedgesingapore.com/wilmar-...on-scandal

[weijian]

There is currently a tussle on going between Malaysia and the EU with regards to the latter banning palm oil usage in biofuels. Malaysia has been arguing it is unfair and simply a conspiracy from the EU to promote their own (rapeseed) products to be used in biofuel instead.

Palm Oil Was Supposed to Help Save the Planet. Instead It Unleashed a Catastrophe.

When a truck burns biodiesel, the carbon emissions that come from its tailpipe aren’t much different from those of a truck burning petroleum. But a part of the biodiesel emissions aren’t counted, because — in theory — they have been balanced out: Plants absorb carbon from the atmosphere when they grow, and fuel experts subtract that sequestered carbon from the tailpipe emission, completing a transaction that they say balances at zero.

In ideal circumstances — unvegetated land planted for the first time — this balancing out really happens. When corn grows, it soaks up carbon, and when it is consumed (whether as food or fuel), it releases that carbon back into the air. But the analysis breaks down when faced with the reality of land use. Almost everywhere in the world, planting more corn or soy for biofuel would involve creating more farmland, which in turn would involve cutting down whatever was already growing on that land. And that would mean releasing a huge amount of carbon into the air, with nothing to balance the books

https://www.nytimes.com/2018/11/20/magaz...rophe.html

[karlmarx]

An interesting story.

While the tactics used by palm oil companies to maximise profits -- as mentioned in the article -- are probably true, it is probably not what the matter is about. Exploitation of the poor and illiterate, bribery of officials to advance own interests, blatant transgressions of regulations, and ignorance of officials on such transgressions; these take place in almost all jurisdictions in the world, all the time.

Whether palm oil plantations and the use of biofuels produce more carbon than other sources of fuel -- the answer to which will have implications on which of these fuel producers stand to benefit -- is a question of science. But from the article, it seems that there is no consensus to that question. Perhaps there is no consensus because there are competing interests. Competing interests lead to competing (scientific) opinions.

Does the ban of palm oil use stem from an environmental perspective? Or are 'environmentalists' (unknowingly) acting in favour of interests that will benefit from the banning of palm oil?

Is the use of palm oil more harmful than other sources of fuel?

Who benefits from the banning of palm oil?