Financial results

Olam Group shares rally as ofi delivers solid earnings growth

By Anthony Myers

- Last updated on GMT

Pic: Olam Group
Pic: Olam Group

Related tags ofi Cocoa Olam Food Ingredients

Agribusiness group Olam has reported a significant improvement in its second-half full-year results and says London listings for ingredients supplier subsidiary ofi is still planned.

The group said the turnaround follows ebit growth and lower exceptional losses with earnings of Singapore $230.8 million ($171.47m) for its 2HFY2023 ended December, up 15.5% y-o-y. Still, revenue for the period declined by 10.8% y-o-y to S$23.6 billion as lower prices across several products in the portfolio offset sales volume growth.


The group said its cocoa and food ingredients supplier (ofi) continues to execute its strategy by investing for the future with new manufacturing assets and enhanced capabilities in sustainability, digital, innovation, and other customer-facing areas.  “While overall end-consumer demand is uncertain across some categories, ofi is well-positioned to service its customer needs, with strong and expanding solutions capabilities combined with surety of supply, traceability and sustainability impacts.”

Ofi EBIT growth of 15.4% in H2 2023 over H2 2022; 11.1% YoY in 2023, led by Ingredients & Solutions segment, which showed a YoY increase of 31.1%.

A. Shekhar, CEO of ofi, said: We delivered solid earnings growth alongside continued execution of our strategy, to pivot towards a more solutions-led and customer centric organisation. In light of the uncertain macro-economic conditions, we took a deliberate call to focus only on selective volume growth opportunities that maximise earnings and returns. This was reflected in the strong earnings growth in 2023 on reduced volumes, particularly from the Ingredients & Solutions segment.

“We commissioned two significant greenfield investments in the year, the New Zealand dairy processing facility and Brazil soluble coffee facility. We also opened our fourth Customer Solutions Centre in Amsterdam. Each of these investments is fully aligned to the strategy to grow our Ingredients & Solutions business, delivering exciting, value-added opportunities for our customers, supported as always by our integrated supply chain that can offer supply security, sustainability, and traceability.”

  • ofi’s guidance remains unchanged at low to mid-single-digit total volume growth and high single-digit adjusted total EBIT growth over the medium term.


Olam co-founder and chief executive Sunny Verghese said the group remains committed to pursuing the listings of Olam Food Ingredients (OFI) and Olam Agri. OFI was initially slated to be listed in London and Singapore in the second quarter of 2022.

“We will, however, retain flexibility around the sequencing of the two proposed listings and explore other strategic options to unlock value for shareholders. The double-digit Ebit growth at both OFI and Olam Agri in H2 2023 reflects their differentiated, unique business propositions and solid execution post reorganisation.“We are confident of our growth prospects and are taking steps to ensure we continue to drive returns for investors amid a challenging macroeconomic backdrop and uncertain geopolitical conditions.”


Verghese also addressed recent reports that Nigeria’s Department of State Services was investigating Olam Nigeria, Olam Group and its subsidiaries for alleged fraud.

“Finally, we understand there has been some concern following allegations in the media about our Nigerian operations. As announced on February 19, 2024, an independent internal investigation launched by the Olam Group Board and its Audit & Risk Committee comprising external counsels and independent auditor has concluded. The investigation team found no evidence supporting any of the specific allegations reported. In the meanwhile, all our businesses in Nigeria have been operating normally and we look forward to continue investing and growing in the country.”


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