Global commodity trader Trafigura Group hit a record net profit for a second year running in its 2021 financial year after a strong performance across divisions and significant energy market dislocations.
The Geneva-based firm posted a net profit of $3.1 billion for its financial year ending Sept. 30, almost double the previous year.
"Above all, the scale and resilience of our business benefited from a flight to quality, both in terms of customer relationships and financial liquidity," Trafigura Chief Executive Jeremy Weir said in the annual report.
The COVID-19 pandemic roiled markets last year and saw a number of smaller competitors exit or reduce their business, allowing bigger players to step in and expand credit lines at banks.
Trafigura's total earnings before interest, tax, depreciation and amortisation (EBITDA) rose 13% to $6.9 billion. Its energy segment - mostly oil, refined products and natural gas - contributed 64% to the EBITDA.
Its metals and minerals division contributed 36% with an "exceptional year" for its copper team due to significant demand growth and a supply deficit.
Group revenue was $231 billion in 2021, up from $147 billion in 2020 when commodity prices crashed due to the COVID-19 pandemic.
The company had impairments of $709 million, down compared with $1.57 billion in 2020. The largest were at loss-making smelting company Nyrstar with $125 million, and at Corpus Christi port in Texas with another $158 million relating to right-of-use assets.
In addition, Trafigura's income was reduced by a further $716 million after absorbing Puma Energy's foreign exchange losses though this translated to a increase in group equity.
Trafigura agreed to buy Angola's state oil firm Sonangol 31.78% stake in Puma Energy, a midstream and retain firm, with Trafigura's stake rising to 93%.
Trafigura said the number of employee shareholders has been growing since it bought out the family members of founder and former CEO Claude Dauphin in 2020. This year employee shareholders hit about 1,000 compared with 850 in 2020.
Pay-outs to employees hit a record of $1.1 billion, nearly double dividends in 2020 at $586 million. Group equity rose 36% to over $10 billion.
Its traded oil volume rose 25% year-on-year to 7 million barrels per day (bpd), growing across regions as global demand recovered with easing lockdowns while its traded non-ferrous metals rose 9% to 22.8 million tonnes and bulk minerals were up 8% to 82.7 million tonnes.
Crude oil volumes grew 22%, thanks in part to new offtake agreements in Canada, Latin America and West Africa and a deal to supply Britain's Lindsey oil refinery. It added that the Midland shale oil basin in Texas remained core to the business.