Olam International flagged efforts to broaden its sources of funding and boost cash flows, even as the agricultural trading house, which came under attack from short-selling house Muddy Waters, unveiled a halving in profits.
The group, one of the "Now" group of major Asian trading houses, with Noble Group and Wilmar International, reported a 48% slump to Sing$56.8m in earnings for the April-to-June quarter.
The figure, well below market expectations of a $75.4m result, reflected largely the payment of Sing$50.6m in taxes. A year before the group had received a tax credit of Sing$8.2m.
However, Olam International chief executive Sunny Verghese also flagged "challenging market conditions" which had emerged during the quarter, "and affected some parts of our business".
The grain origination operations in Australia and Ukraine, highly competitive markets, sustained "lower margins", while the Argentina peanut business suffered from a "steep decrease in prices".
The group's Latin American coffee margins had also suffered a drop in margins, thanks to the outbreak of coffee rust in Central America.
Nonetheless, at an operating level, the group achieved a rise of 4.2% to Sing$458.7m in profits, on revenues up 26% at Sing$6.50bn, in a quarter which represented the first under a new strategic plan drawn up after Muddy Waters attacked the group over debt levels, terming the Olam balance sheet a "black hole".
"We remain focused on the twin goals of pursuing profitable growth and sustained cash flow generations," Mr Verghese said, saying the Olam was in a "transition" period.
The group had, in the year to the end of June, raised net operating cashflow by 25% to $735m, although this was still not enough to cover capital expenditure, despite a fall in spending by 15.8% to Sing$1.05bn.
On its sources of funding Olam had cut to 56%, from 77%, its reliance on banks, thanks to issuance of medium term notes and a rights issue, terming its mix "well diversified".
Nonetheless, its underlying gearing, in terms of net debt compared with equity, had risen to 0.55 times as of the end of June, from 0.37 times a year before.
Winners and losers
The group also divided its assets into those giving "strong" returns, including wheat milling and Indonesian sugar refining, those in "gestation", the palm and rubber plantations yet to mature, and underperformers.
The underperformers included Gabon timber, Indian sugar milling, and the Russian and Uruguayan dairy operations.
Olam also said that its investments in coffee plantations, and soluble coffee and cocoa processing, were "yet to yield", while its investment in alternative sweeteners group PureCirle was "still not contributing to earnings".