Thursday 28 Mar 2024
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KUALA LUMPUR (Jan 27): Fraser & Neave Holdings Bhd's (F&N) revenue continued to recover in the first financial quarter ended Dec 31, 2020 (1QFY21).

The group's quarterly revenue grew 13.6% quarter-on-quarter (q-o-q) to RM1.08 billion in 1QFY21 from RM953.7 million amidst a gradual recovery in local and export markets as business returned to operating under the "new norm", according to F&N's filing with Bursa Malaysia.

The higher revenue lifted F&N's quarterly net profit, which doubled to RM136.8 million from the RM68.03 million achieved in the immediate preceding financial quarter.

Malaysian operations' revenue grew 14.8% to RM568.2 million from RM495.1 million in 4QFY20. Revenue generated by the Thai operations increased by 12.3% to RM514.4 million in 1QFY21 from RM458 million in 4QFY20 due to stronger Thai baht.

On a year-on-year (y-o-y) basis, the group's net profit managed to grow by 6.58% from the corresponding quarter in the previous year thanks to tax incentives enjoyed by its Thai operations.

In a bourse filing, the soft drink manufacturer noted that its revenue came in 2.52% lower at RM1.08 billion, from RM1.11 billion in 1QFY20.

F&N said its business in Malaysia recorded a 2.9% drop in revenue to RM568.2 million, as the corresponding quarter in the previous year saw earlier seeding-in for Chinese New Year in 2020. The segment's operating profit declined by 7.8% to RM44.9 million on lower revenue, commodity price pressures and lower export margins.

Thai operations also posted a decline in revenue, falling 2.2% y-o-y to RM514.4 million on a weaker Thai baht. In Thai baht terms, the group noted that revenue did increase 0.6% due to growth in the Indochina and export markets, while domestic revenue declined marginally due to the slower off take in in the traditional trade channels and sharp fall in the number of tourists.

Operating profit for its Thai operations declined marginally by 1.3% due to a weaker Thai baht. However, in Thai baht terms, operating profit improved by 1.5% due to higher volume and control of advertising and promotional spending and partially mitigated by higher commodity prices.

Moving forward, F&N said it remains cautious amid the current pandemic, with the situation remaining fluid and uncertain. It noted that skimmed milk prices, along with other commodities trading higher, with some export markets were impacted by higher freight charges due to shortage of shipping containers.

"While cognisant of the challenging period ahead, our long history has taught us to look beyond this crisis. We are exploring ways to 'reimagine' our businesses through organic growth and inorganic growth to ensure a more sustainable future.

"We have sharpened our route-to-market and channel strategies to fulfil our consumers' needs and expectations. We will strengthen and scale up our eCommerce operations to ride on this fast-growing channel. The acquisition of Sri Nona Companies will enable us to establish halal food as our new pillar of growth.

"For exports, we remain focused on growing our sales in existing markets and expanding to new markets while adapting and refining our strategies to constraints imposed by the pandemic," it said.

Shares in F&N finished 0.33% or 10 sen higher to RM30.60, valuing it at RM11.22 billion. It saw 191,700 shares done.

Edited ByKathy Fong
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