Reconfiguring global supply chains

Trafigura delivered a strong performance in the first half of its 2023 financial year, covering the six months to the end of March, with net profit for the period of USD5,544 million.

Strong demand for our services amid challenging market conditions and continued disruption to the movement of vital resources around the world, enabled Trafigura Group to report a strong performance for the six-month period ended in March.

Net profit for the period was USD5,544 million, more than double the figure of USD2,659 million registered at the same time a year earlier.

This result was driven by our ability to help our customer base adapt to changing trade flows, particularly in natural gas and shipping, as many of the complex issues that defined commodity markets in our 2022 financial year persisted.

As has been observed repeatedly in recent years, these types of conditions play directly to the strength of companies such as Trafigura, with deep knowledge of markets and logistics backed up by infrastructure and with access to liquidity.

The Group’s underlying earnings before interest, tax, depreciation and amortisation (EBITDA) rose 73 percent to USD8,136 million, up from USD4,713 million in the first half of 2022.

Revenues were 23 percent lower at USD131,335 million, down from USD170,609 million. This was a result of lower average commodity prices and trading volumes.

In the financial year to date, Trafigura has traded an average of 6.3 million barrels per day of oil and petroleum products, compared to an average of 7.3 million barrels per day in the first six months of the 2022 financial year. In non-ferrous metals and bulk minerals, volumes fell by 8 percent to 54.4 million tonnes in the six months to the end of March, compared with the corresponding period a year ago.

In spite of our strong performance, as referenced in the CEO statement, we did encounter a serious fraud in our nickel business, which we disclosed in February.

Although many of the shipments were in transit and awaiting inspection, we nevertheless decided to record a charge of almost USD600 million in the first half of 2023 related to the fraud. The charge is predominantly presented in the consolidated statement of income under materials, transportation and storage.

Turning to our industrial assets, in January 2023 we completed the sale of our minority interest in Nayara Energy, which operates one of the largest refineries in India, while in October 2022, Puma Energy completed the sale of 19 infrastructure and storage assets.

Consolidated statement of income

Revenue fell 23 percent year-on-year due to lower trading volumes and weaker commodity prices. However, our operating profit before depreciation and amortisation was up 74 percent to USD8,088 million, compared to USD4,648 million a year ago, as a result of strong demand for our supply chain services.

Of total revenue, the Energy segment, which also includes our gas and power businesses, contributed USD89,162 million, 21 percent less than the USD112,903 million generated in the first half of 2022. Operating profit before depreciation and amortisation in the Energy segment was USD7,284 million, compared to USD2,889 million in the same period a year earlier.

In Metals and Minerals, revenue dropped 27 percent to USD42,173 million from USD57,706 million, and divisional operating profit before depreciation and amortisation fell 54 percent to USD813 million mostly due to the USD590 million charge taken in relation to the nickel fraud.

Lower traded volumes and prices resulted in the cost of materials, transportation and storage falling to USD121,597 million from USD164,191 million. Our net finance expense increased to USD995 million, from USD689 million because of the sharp rise in base rates. However, it is important to note that these costs are passed through to our supply chain services.

The result from equity-accounted investees and investments rose sharply to USD169.7 million, from USD3.8 million, mainly because of the Nayara sale transaction.

Balance sheet

At the end of the period, our total balance sheet was USD90,451 million, down 8 percent from USD98,634 million at the end of September 2022. The reduction was driven by lower financing needs for our trading activity, primarily thanks to lower commodity prices.

Lower trading volumes and prices were reflected by the drop in current assets to USD74,020 million at the end of March 2023, down from USD78,767 million six months earlier.

Total non-current assets were also lower, down 17 percent from the corresponding period six months ago at USD16,174 million.

Current loans and borrowing dropped by 3 percent to USD28,699 million as a result of slightly lower working capital needs.

Our ratio of adjusted debt to Group equity stood at minus 0.22, significantly below our financial policy on leverage target of 1 times Group equity.

Due to our strong profitability, Group equity at the end of the period was USD17,654 million, 17 percent up from USD15,079 million at the end of September 2022. A USD2,985 million dividend was declared by Trafigura in March 2023. In accordance with its financial policy, Trafigura can declare and pay dividends subject to maintaining the Group's liquidity and financial leverage at an adequate level. This dividend forms part of our balance sheet management, along with the deleveraging achieved over the past few years as reflected in our adjusted debt ratio.

Liquidity and financing

Trafigura secured increased access to financing lines, throughout the half year, strengthening our ample liquidity buffer to manage potential future spikes of volatility in commodity markets. Total credit lines reached a level of USD75 billion, excluding Puma Energy, from a network of around 150 financial institutions. Overall, our funding position leaves us very well placed to cope with increased market volatility and continue to meet the needs of our customer base.

The majority of our day-to-day trading activity is financed through uncommitted, self-liquidating trade finance facilities, while we use corporate credit facilities to finance other short-term liquidity requirements, such as margin calls or bridge financing. This funding model gives us the necessary flexibility to cope with periods of enhanced price volatility as utilisation of the trade finance facilities increases or decreases to reflect the volumes traded and underlying prices. We also maintain a debt capital markets presence to secure longer-term finance in support of our investments.

In October 2022, the Group refinanced its Asian Syndicated Revolving Credit Facility (RCF) and Term Loan Facilities (TLF) at USD2.4 billion equivalent, with 28 banks participating in the transaction, including three new lenders. The new facilities comprised a 365-day USD RCF (USD685 million), a one-year CNH TLF (c. USD1,217 million-equivalent) and a three-year USD TLF (USD469 million). In line with our European RCF from March 2022, we updated the set of key performance indicators (KPIs) of the sustainability-linked loan structure.

Also, in October 2022, we entered into a USD3.0 billion four-year loan agreement guaranteed by the government of Germany acting through the German Export Credit Agency (ECA). This loan supports the commitment by Trafigura to deliver substantial volumes of gas to Securing Energy for Europe (SEFE), over the next four years.

In January 2023, we continued growing our portfolio of ECA financing lines with a USD135 million two-year facility with Abu Dhabi Exports Office (ADEX), the export financing arm of Abu Dhabi Fund for Development. The financing will support Trafigura’s continued procurement of metals, minerals and refined hydrocarbons from the UAE.

In March 2023, we refinanced our flagship 365-day European multi-currency syndicated revolving credit facilities (ERCF) totalling USD1.9 billion, while extending and increasing our USD3.5 billion three-year RCF. In line with the last two years, we structured these facilities as sustainability-linked loans, with an updated set of KPIs, including a new target on the reduction of lost time incident rate (LTIR). The new 365-day ERCF was initially launched at USD1.5 billion and closed substantially oversubscribed.

Finally, in March 2023, Trafigura closed a USD225 million US Private Placement (USPP) across seven- and ten-year tenors. The deal was our seventh in this market following our first issuance in 2006, and was timed to refinance USD110.5 million USPP maturities. The transaction was upsized from an initial USD100 million following strong investor demand, with almost two-thirds of the total amount raised in the ten-year tranche. The issuance was Trafigura’s second largest USPP to date and our first USPP without a tranche of five years or less, as investors focused towards longer tenors.

Cash flow

Our performance over the first half of the year resulted in a rise in operating cash flow before working capital changes by 73 percent to USD8,112 million from USD4,677 million.

We believe operating cash flow before working capital changes is the most reliable measure of Trafigura’s financial performance because the level of working capital is predominantly driven by prevailing commodity prices and is financed under the Group’s self-liquidating finance lines. Net cash from operating activities was USD5,695 million, as net financing costs increased while working capital requirements remained fairly stable over the period.

Investing activities resulted in a net cash use of USD763 million, compared to a cash inflow of USD506 million in the first half of 2022.

Net cash used in financing activities was a net outflow of USD3,132 million, with the overall balance of cash and cash equivalents standing at USD16,681 million as of 31 March 2023, up 12 percent compared to 30 September 2022.


The profitability of the Group during the first half of the year is a testament to the resilient, global business that we have built up since we were founded in 1993.

While we expect our supply chain management services to remain in demand during the second half of the year, we are seeing a return to more normal market conditions. Therefore we expect the pace of our growth to slow compared to the previous 12 months.

We are also conscious that there are a growing number of headwinds, including inflationary pressures, higher interest rates and ongoing geopolitical tensions, which could impact global economic growth.

To that end, we will maintain a sharp focus on credit risk amid a shortage of US dollars in some parts of the developing world.

The Group will also maintain a disciplined approach to acquisitions. While we will continue to invest in assets that support our core supply chain activities, this will be done in a very measured way and only when it can deliver acceptable rates of return.

Looking further ahead, we remain positive about the long-term prospects for the Group, as the world shifts away from getting the vast majority of its energy from fossil fuels to cleaner forms of energy.

Christophe Salmon

Group Chief Financial Officer