Commodity dealer Trafigura reported report web earnings of $5.5bn within the first half of its monetary yr — greater than double the identical interval 12 months in the past — underscoring the bumper earnings these teams have reaped from the power disaster.
It additionally paid a report $3bn dividend to be shared amongst about 1,200 shareholders within the privately held firm, that are nearly all merchants and executives on the agency. That was up from $1.7bn within the earlier yr.
The numbers cushion the blow of the practically $600mn impairment cost Trafigura took this yr after it uncovered an alleged nickel fraud by a counterparty, one of many greatest scandals within the metals buying and selling sector.
The corporate mentioned it was nonetheless figuring out the extent of the fraud, pursuing alleged perpetrator Indian tycoon Prateek Gupta in London’s Excessive Courtroom, and inspecting whether or not the 1,100 containers concerned include any nickel.
Chief monetary officer Christophe Salmon mentioned Trafigura was taking authorized motion towards the alleged perpetrator in “a number of jurisdictions”, the primary time the group has indicated it’s pursuing prices exterior the UK.
Trafigura has additionally elevated the dimensions of the impairment cost associated to the nickel case to $590mn, up from $577mn beforehand, as a consequence of further prices incurred.
The outcomes spotlight how the most important commodity buying and selling homes, the highly effective corporations that transfer uncooked supplies all over the world, proceed to learn from the disruptions triggered by the Russian invasion of Ukraine.
Trafigura’s monetary yr runs from September, and its half-year outcomes cowl the interval till the tip of March.
“Any dislocation of the provision chain implies that our [logistical] companies are taking extra worth,” mentioned Salmon. “Our companies have been very wanted by the provision chain, and we have been key to making sure safety of provide, notably to western Europe.”
Through the six months ending on March 31, 2023, the group reported web revenue of $5.5bn, and earnings earlier than curiosity, taxes, depreciation and amortisation of $8.1bn.
That interval contains final winter, when Europe’s fears of blackouts and gasoline shortages following the battle led to massive swings in power costs and a race to safe gasoline provides.
One end result of that was Trafigura’s $3bn, four-year deal to produce gasoline to Germany, which was partly underwritten by the German Export Credit score Company, Euler Hermes.
The bumper half-year earnings will nearly definitely contribute to a different spherical of huge bonuses on the finish of the monetary yr.
Fairness attributable to the corporate’s homeowners rose to $17.5bn on the finish of March from $14.9bn on the finish of September 2022.
Different giant buying and selling homes reminiscent of Vitol and Glencore have additionally benefited from the volatility and disruptions, with all the main merchants reporting record earnings final yr.
Nonetheless, Trafigura signalled the earnings bonanza was unlikely to proceed, and mentioned that calmer market circumstances lay forward.
“We’re seeing a return to extra normalised market circumstances,” mentioned Salmon. “The profitability within the second half of the yr, nonetheless being very strong, might be decrease than what we noticed within the first half yr.”
Through the first half of the monetary yr, Trafigura mentioned that decrease general commodities costs led to decrease general income of $131.3bn, which is 23 per cent decrease than the identical interval the earlier yr.
Nonetheless, its margins rose, with web revenue reaching 4.2 per cent of income throughout its first half, up from 1.6 per cent throughout the identical interval 12 months prior.