Commodity specialists Trafigura Group (Trafigura) have reported company record profits of $3.1bn, with rising demand for metals and oil in a challenging economic environment.
Trafigura’s business of moving raw materials has gone from strength to strength amid supply chain disruptions caused by the Covid-19 pandemic.
Demand has also increased as pandemic restrictions eased this summer, with oil prices rallying to three-year highs in October.
According to its freshly released full-year results, the company traded an average of seven million barrels of oil and petroleum products per day over the year, enjoying a significant 25 percent increase on the prior year.
Meanwhile, the minerals and metals were the standout performer, with the division enjoying a 95 per cent revenue increase.
The company handled 105.5m tonnes of non-ferrous metals and bulk minerals – contributing $2.5bn to its underlying EBITDA.
Net profits are nearly double last year’s results – despite including a $716m reduction due to IFRS rules on foreign currency translations after the consolidation of Puma Energy into the firm.
The company has paid out $1bn to executives and staff in a bumper pay day, according to The Financial Times.
The handout comes amid rising revenues, which have also increased by 57 percent to £231.3bn, reflecting higher commodity prices and heavier trading volumes as the group expanded its customer base and moved into new markets.
Trafigura’s EBITDA also rose 13 percent to $6.9bn million from $6.1bn in 2020.
Group equity has also risen by 36 percent to $10.56bn, the first time that the group’s equity value has passed $10bn.
Jeremy Weir, Trafigura’s executive chairman and chief executive said: “Trafigura’s performance in 2021 again set new records in terms of volumes handled and overall profitability. We also made excellent progress over the course of the year in further diversifying our business to play a meaningful role in the ongoing energy transition.”
Commenting on the wider economic climate, the boss said the pandemic exposed “underlying fragilities in global supply chains” as demand rebounded with the easing of lockdown restrictions while “logistics and supply struggled to keep pace”.
This follows the commodities boss warning of potential blackouts in Europe this winter as the continent’s energy crunch worsens.
Trafigura is also doubling down on its environmental plans – outlining a strong start for its new renewables division, which generated underlying EBITDA of $80 million during the year.
It has also invested in resources to boost the company during the energy transition such as a stake in Vostok Oil, a low-cost, low carbon intensity oil and gas resource in Russia.
It has also invested in nickel and cobalt producer, Prony Resources, in New Caledonia.
The investments follow the announced target or reducing total shipping emissions by 25 percent by 2030, compared to its 2019 adjusted baseline