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Confectionery and Beverage Ingredients

The Confectionery and Beverage Ingredients segment posted a healthy volume growth of 22.3% with contributions from Cocoa and Coffee.

However, revenue growth was modest at 5.5% as the volume growth was mostly offset by lower prices for both coffee and cocoa.

EBITDA declined 19.5% in 2017 due to a significantly lower contribution from Coffee. While it had a good first half, tougher market conditions and short crop across major origins in the latter half of the year adversely impacted its overall EBITDA in 2017. In cocoa, the processing business performed well throughout the year, while the supply chain and products trading businesses, which faced margin compression in the first nine months of the year, saw margins stabilise in Q4 2017.

Invested capital in this segment fell by a substantial S$762.5 million as compared with 2016. This was mainly on account of lower working capital following targeted optimisation initiatives as well as lower cocoa and coffee prices from a year ago.

EBITDA/IC for the segment declined marginally from 6.9% in 2016 to 5.7% in 2017.