Trafigura’s business results in the first half of fiscal year 2023 recorded a significant jump in profits, amid an escalating energy crisis and disruptions in commodity supply chains in recent years. It was able to achieve strong performance due to continued demand for the Group’s services to help secure access to critical resources.
The leading company in the global commodity industry – in its 2023 interim report for the 6-month period ending on March 31, 2023 – indicated that it achieved a net profit of $ 5.5 billion, more than double the figure recorded at the same time last year, which amounted to 2.7 Billion dollar.
And Trafigura stated – in a press release seen by the specialized energy platform – that these results were driven by the group’s ability to help customers adapt to changing trade flows, especially in natural gas and shipping, with the persistence of many complex problems that commodity markets witnessed in the fiscal year. 2022.
It is noteworthy that the results of Trafigura’s business for the year 2023 cover the period from October 2022 to September 2023.
Trafigura’s business results for the first half of 2023
Trafigura’s underlying EBITDA increased by 73%, to $8.1 billion, compared to $4.7 billion in the first half of 2022; As a result of strong demand for the company’s supply chain services.
Revenue decreased by 23% to $131.3 billion, down from $170.6 billion, as a result of lower average commodity prices and trading volumes, according to Trafigura’s business results published today, Wednesday (June 7, 2023).
Of total revenues, the energy segment – which also includes the gas and electric business – contributed $89.2 billion, 21% less than the $112.9 billion the company achieved in the first half of 2022.
“It is becoming increasingly clear that the transition to a low carbon economy will not happen without our industry,” said Executive Chairman and CEO of Trafigura, Jeremy Ware.
“Our unique insight and expertise in managing global supply chains, developing new markets and investing in new supplies of low-carbon fuels, such as hydrogen and key transition metals, means that we are well-positioned to play a critical role in this transformation,” he added.
He also said, “At the same time, we also have a responsibility to provide energy and electricity to meet the needs of the growing numbers of the world’s population.”
Trafigura divisions performance in the first half of 2023
Trafigura’s Oil and Petroleum Products division delivered another strong performance, adapting quickly to changing market conditions and trade flows.
He also secured an agreement to provide crude oil to the Italian “ESAP” refinery, one of the largest oil refineries in southern Europe, and to market the refined fuel it produces.
In the first half of fiscal year 2023 ending March 31, 2023, the company traded an average of 6.3 million barrels per day of oil and petroleum products, compared to an average of 7.3 million barrels per day in the first six months of fiscal year 2022.
The Natural Gas and LNG division also delivered a strong half year providing security of supply to customers in tense markets, demonstrated by a long-term agreement to deliver a significant volume of gas to SEFE (Energy Insurance for Europe).
There was also a strong contribution from the Freight Forwarding and Chartering Division which has skilfully deployed its fleet in one of the strongest tanker markets in recent history to assist the company’s commercial teams and external customers, reduce its carbon intensity and is on track to meet its long-term environmental goals.
In the non-ferrous metals and bulk metals division, volumes were down 8%, to 54.4 million tonnes in the six months to the end of March, compared to the same period last year.
Trafigura forecasts for the second half of 2023
“The group’s profitability for the first half of the year is testament to the resilient global business we have built since our founding in 1993,” said Trafigura Group Chief Financial Officer Christophe Salmon.
He revealed his expectations, saying, “While we expect continued demand for our supply chain management services during the second half of the year, we are seeing a return to normal and calmer market conditions, and as such, we expect our growth to slow compared to the previous 12 months.” This came in a press release, which was seen by the specialized energy platform.
He continued, “We also recognize that there are an increasing number of headwinds, including inflationary pressures, interest rate hikes, and persistent geopolitical tensions, that could affect global economic growth.”
To this end, “we will maintain our strong focus on credit risk amid a US dollar shortage in some parts of the developing world… The group will also maintain a disciplined approach to acquisitions,” Salmon confirmed.
“Looking ahead, we remain positive about the group’s long-term prospects as the world shifts away from obtaining the vast majority of its energy from fossil fuels to cleaner forms of energy,” he said.
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