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Here Are 2 Companies That Reported Growth In Their Latest Earnings Updates

The earnings season had recently come to an end. As is common with every earnings season, there will be some companies posting growth, some posting mixed numbers, and some experiencing declines. Let’s take a look at two companies that delivered growth recently:

1. In early March, Jardine Strategic Holdings Limited (SGX: J37) released its 2017 second half and full year earnings update.

As a quick introduction, Jardine Strategic is a a sprawling conglomerate with interests in many Singapore-listed companies such as automobile distributor Jardine Cycle & Carriage Ltd (SGX: C07), bricks-and-mortar retailer Dairy Farm International Holdings Ltd (SGX: D01), hotelier Mandarin Oriental Limited (SGX: M04), and more.

In 2017, Jardine Strategic’s revenue increased by 7% to US$31.56 billion. Its underlying year profit attributable to shareholders did even better, growing by 11% to US$1.60 billion. As a result, the conglomerate’s underlying earnings per share (EPS) was up by 13% to US$2.76. Jardine Strategic had decided to share the spoils with its investors, as it raised its full-year dividend for 2017 by 7% to US$0.32 per share.

The conglomerate also ended 2017 with a reasonably strong balance sheet. Jardine Strategic’s net debt (excluding financial services companies) of US$3.77 billion as of 31 December 2017 was up from US$2.02 billion at end-2016, but the gearing ratio (net debt over equity) at the end of 2017 was just 6.5%.

In Jardine Strategic’s earnings update, its chairman, Sir Henry Keswick, shared the following comments on the conglomerate’s outlook:

“The Group’s key markets in Greater China and Southeast Asia look well placed for 2018 as the good levels of economic growth seen in 2017 appear set to continue. This, when coupled with the development initiatives that are being pursued across the Group’s businesses, provides the basis for future profit growth.”

2. Wilmar International Limited (SGX: F34) is next in line. The company reported its 2017 fourth quarter and full year earnings update in late February. As a quick introduction, Wilmar is an agricultural company that operates through four main segments: Tropical Oils, Oilseeds and Grains, Sugar, and Others.

In 2017, Wilmar saw its revenue increase by 5.9% to US$43.85 billion. This was mainly due to growth in the Tropical Oil and Oilseeds and Grains segments. Profit attributable to shareholders did even better, climbing 25.4% to US$1.22 billion, as big jumps in the company’s share of results of joint ventures (a 270.7% increase to US$34.81 million) and associates (a 47.2% increase to US$193.51 million) contributed to the bottom-line.

Just like Jardine Strategic, Wilmar also shared the fruits of growth with its shareholders. The agricultural giant’s dividend for 2017 was S$0.10 per share, up from S$0.065 per share in 2016.

Wilmar gave the following useful comments about its prospects in its earnings update:

“Our portfolio of high quality agribusiness enabled the Group to do well in 2017. Looking ahead, we expect our integrated business model to continue to achieve sustained growth. Barring unforeseen circumstances, performance in FY2018 is expected to be satisfactory.

The internal restructuring of the Group’s China operations, with a view to a possible separate listing, has been largely completed. We would like to emphasize that as the proposed listing is still at an evaluation stage, shareholders are advised to exercise caution in trading their shares. There is no certainty or assurance as at the date of this announcement that the listing proposal will be carried out.”

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Lawrence Nga doesn’t own shares in any companies mentioned. The Motley Fool Singapore has a recommendation for Dairy Farm International Holdings.