Friday 29 Mar 2024
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KUALA LUMPUR: Dutch Lady Milk Industries Bhd is cautiously optimistic of repeating its 2014 top-line performance of RM1 billion for the current financial year ending Dec 31, 2015 (FY15), amid prevailing weak consumer sentiments in the market.

Like any other countries that have implemented consumption taxes similar to the goods and services tax, Dutch Lady managing director Saw Chooi Lee said she expects Malaysia to see a few more months of weak consumer sentiment before easing.

“We will look at the next three to six months. What we would like to continue to do is leveraging the strength of Dutch Lady, because it is a brand that has been in Malaysia for over 50 years. We will continue to stay close to, and focus on giving value back to our Malaysian consumers,” she told reporters after the group’s annual general meeting yesterday.

Saw hopes that the group will be able to maintain its RM1 billion revenue for FY15, though she refrained from making any guarantees.

“It is a challenging environment. But I think we have a few things that will help us remain cautiously optimistic. Firstly, we have the relaunch of two new products. Secondly, we have a very strong Dutch Lady brand.

“And remember we are in the category of nutrition. We want to educate our consumers to spend their money in the right places. We believe we can stay close to consumers and remind them about our nutritious and high quality products. So yes, we have that ambition to continue to grow and maintain the Dutch Lady brand,” she said.

The two new products are Dutch Lady PureFarm and the improved Dutch Lady Children Formula Milk.

She also said the group had allocated RM18 million for capital expenditure, which will be used to improve product quality and increase efficiency.

She also said the group had no plans to increase prices to combat increasing operating costs.

“We want to remain competitive in the market, but will respond to the environment.”

Dutch Lady saw a 26.2% drop in net profit to RM17.03 million or 26.6 sen a share for its first quarter ended March 31 (1QFY15), from RM23.07 million a year ago, on lower revenue and increased marketing investment to support relaunch activities of Dutch Lady Children Formula Milk.

Revenue for the quarter fell 13.5% to RM196.89 million, from RM227.68 million for 1QFY14.

 

This article first appeared in The Edge Financial Daily, on May 28, 2015.

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