KUALA LUMPUR (Nov 7): Fraser & Neave Holdings Bhd (F&N)’s net profit fell 60.39% to RM19.65 million or 5.4 sen per share in its fourth quarter ended Sept 30, 2017 (4QFY17), from RM49.59 million or 13.60 sen per share a year ago, mainly due to one-off organisational restructuring costs.

F&N’s directors recommended a final single tier dividend of 30.5 sen per share in respect of its FY17, to be approved by shareholders, bringing its full year dividend to 57.50 sen.

F&N said apart from restructuring costs, it was also impacted by higher input cost, particularly for sugar in its Malaysian operations and milk powder in its Thai ops. The group’s total revenue slid 0.02% to RM976.28 million, from RM976.5 million last year.

Its profit before tax declined 62.5% to RM19.4 million. "Excluding one-off items, profit before tax declined by 5.8% to RM52.0 million," it noted.

For the entire FY17, F&N’s net profit declined 16.09% to RM323.38 million, from RM385.37 million in the previous corresponding year, while revenue slid to RM4.10 billion, from RM4.17 billion.

Moving forward, F&N foresees its Malaysian business to be challenging, as a result of competitive price pressure and weak consumer demand.

“Management has undertaken an operational productivity transformation initiative in Malaysia, towards improving organisational productivity and efficiency through process improvement. The operational cost savings from this initiative are expected to contribute positively to the Malaysian operations in the new financial year,” the group said.

Meanwhile, F&N said the business outlook in Thailand is positive, but management remains cautious about the state of consumer sentiment.

“Input and packaging material costs have been rising, which affects both the Malaysian and Thailand businesses. Management will continue to be vigilant and responsive to changes in the external environment and consumer trends, take necessary action to maintain long term sustainable growth and continuously grow the export pillar,” the group said.

F&N’s share price climbed two sen or 0.08% to settle at RM25.44 today, giving it a market capitalisation of RM9.32 billion.