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WH Group posts YOY drop in H1 profit as trade tensions cloud outlook

Packaged food and meat producer WH Group Ltd. warned that global trade disputes could increase business uncertainties as it posted a year-over-year decline in first-half profit.

Profit attributable to owners of the company fell to $514 million in the six months to June 30 from $557 million in the year-ago period, after biological fair value adjustments. EPS slipped to 3.47 cents from 3.89 cents.

Revenue edged up to $11.17 billion from $10.66 billion a year ago. Hog production revenue rose to $397 million from $275 million, while packaged meats revenue increased to $5.90 billion from $5.52 billion. Sales of fresh pork dipped to $4.59 billion from $4.64 billion.

"The incremental tariffs on U.S. imported pork because of the recent trade dispute between China and the U.S. further reduced the competitiveness of imports from the U.S.," the company said. China is the world's largest pork producer, followed by the U.S.

Operating profit fell 3.8% year over year to $867 million from $901 million.

The company recommended an interim dividend of 5 Hong Kong per share, unchanged from the year-ago period and payable Sept. 12 to shareholders of record Aug. 28.

Looking ahead, the company expects the oversupply of U.S. meats to continue to suppress prices. It also added that trade tensions between the U.S. and some of its import partners add uncertainties to the company's outlook.