IOI's financial year 2012 brief analysis

I’ve been digging up details on IOI’s Annual Report for financial year 2012 recently. What I concerned most are anything relevant to me thus the figures presented would relate to that.

Let see, the revenue was RM 15 billion but what important to me is the revenue contribution from Loders Croklaan. From the ‘Sales of Specialty Oils and Fats and related products’, I can see that the revenue was RM 3.5 Billion so it’s about 23% from total revenue. It underscores the importance of Loders Croklaan’s business to IOI.

This is interesting to me as well. The cost of salaries/wages was RM 700 million, roughly 4.6% of revenue and up 7% from previous year (could be due to annual increment, business expansion etc).

Generally, profitability will determine how much bonus can be awarded to employee. But shareholders must be rewarded first before employees, thus after deduction of dividends we can see how much left for employee. Of course company can retain earning as capital for business expansion (as what Apple did, they retain all earning (no dividends or bonus) and it has reached USD 100 Billion). Net Income for IOI after tax was RM 1.8 Billion and shareholders were rewarded with 16 sen per share totaling RM 1 Billion. So what’s left still significantly huge amount, RM 800 Million!  

Ever wonder why IOI is called cash rich company, so here it is. As of 2012, total available cash was RM4.3 Billion!

  Last but not least, I’m interested to know the revenue by geographical location. Both Europe and Asia (exclude Malaysia) share almost equivalent sales followed by Malaysia and North America. But Europe and North America combined present almost half of group revenue, given the economic volatility from this region, it has some significance risk to IOI. Hopefully demand from Asia would be able to offset this risk.