This article first appeared in The Edge Financial Daily, on February 3, 2016.

KUALA LUMPUR: Fraser & Neave Holdings Bhd’s (F&N)  net profit more than doubled to RM151.66 million or 41.4 sen a share for the first financial quarter ended Dec 31, 2015 (1QFY16) from RM69.94 million or 19.1 sen a share a year ago on favourable product mix and commodity prices.

In a filing with Bursa Malaysia yesterday, F&N said it benefited from lower advertising and promotion expenses, East Coast flood insurance claim recovery, along with the absence of flood-related costs and provisions made in the corresponding quarter.

Quarterly revenue rose by a marginal 1.64% to RM1.05 billion from RM1.04 billion in 1QFY15, mainly due to the absence of contributions from Red Bull as a result of the termination of exclusive marketing, distribution and sale of Red Bull energy drinks in phases during 4QFY15.

“There is also an increase in end-consumer-related competitive pricing pressures in the trade, particularly with the commencement of Chinese New Year selling-in,” it said.

For the remaining quarters, F&N said the weaker consumer demand will result in intensifying trade price competition, and focus will shift towards end-consumer programmes, pricing and activities, which will soften contribution margins.

“Against this, both the board and management remain vigilant, and will diligently monitor and track changing market dynamics and conditions, with a view of strategising and formulating appropriate actions to maintain its market position and profitability,” the group pledged.