ROTTERDAM, THE NETHERLANDS, 29 September 2016 – Louis Dreyfus Company B.V. (LDC) today announced its consolidated financial results for the six-month period ended June 30th, 2016.
Net sales reached US$23.5 billion, down from US$26.4 billion in the same period last year, reflecting a weak price environment for most agri-commodities and a significant decrease in metals prices, despite a 1% rise in shipped volumes year-on-year. Income before tax stood at US$151 million, compared to US$177 million the previous year. The Group reported a consolidated net income, Group Share, of US$135 million, versus US$130 million one year ago. The Return On Equity (ROE)1, Group Share, was 5.5%, compared to 4.1% for the full year 2015.
“I’m especially pleased that in this challenging environment for our sector, we were able to sustain satisfactory results and even continue to increase our sold volumes, through a combination of our extensive market knowledge, our well-placed network of logistic and processing assets, and our diversified business lines,” said Gonzalo Ramírez Martiarena, Chief Executive Officer of Louis Dreyfus Company B.V. “In the first half we invested US$132 million in further developing our operations and capabilities, thereby adding significant value for our customers. Through any cycle and any change in market conditions, our business remains fundamental: sourcing, transforming, transporting and supplying soft commodities to an ever growing population for whom food will always be a vital need.”
The external environment remained difficult during the first half of 2016, with growth slowing in China, the US’ recovery failing to fully spread to other major economies, and numerous instances of political instability and geopolitical tensions.
The 1% increase in shipped volumes year–on-year was driven by the Group’s Value Chain segment’s robust grains and oilseeds export volumes from South America. In particular, the segment (comprising the Oilseeds, Grains, Juice, Sugar, Rice, Fertilizers & Inputs and Freight platforms) booked US$351 million in Operating Results2, compared to US$405 million posted for the first half of 2015.
LDC’s Merchandizing segment (including the Cotton, Coffee, Dairy, Metals and Finance platforms) sustained strong shipped volumes, assisted particularly by dynamic flows for metals. The segment’s Operating Results stood at US$195 million for the semester, down from US$233 million one year before.
During the first half of 2016, LDC finalized the expansion of the Bahía Blanca port terminal in Argentina, began operating its new biodiesel plant in Indonesia and continued to build a barge fleet as part of its North Corridor export project in Brazil. Ongoing construction projects include the West Memphis river terminal in Arkansas, US, a grains elevation and storage asset in the province of Buenos Aires, Argentina, and the expansion of a grains terminal in Russia’s Rostov region.
Highlights for the six-month period ended June 30th, 2016:
LDC’s complete 2016 Interim Report is available at www.ldcom.com.
1 Beginning of period – annualized – excluding perpetual hybrid capital securities
2 Gross margin plus share of income in associates and joint ventures