F&N earnings up 18.2% in Q2, thanks to Thai unit

PETALING JAYA: Fraser & Neave Holdings Bhd’s (F&N) net profit for the second quarter ended March 31, 2017 rose 18.2% to RM107.08 million from RM90.57 million a year ago, mainly thanks to its Thailand segment that was aided by favourable milk-based commodity and packaging costs.

The group’s revenue eased 2% from RM1.01 billion to RM992.74 million compared to the same period last year.

It has proposed to declare an interim dividend of 27 sen per share amounting to about RM99 million.

For the six months period, F&N’s net profit fell 3.3% to RM234.36 million from RM242.23 million a year ago, while revenue was flat at RM2.08 billion.

Moving forward, F&N CEO Lim Yew Hoe said the group will continue to ramp up exports while accelerating its transformation program ahead of the conclusion of its current financial year.

“Our first half performance in Malaysia reflects the current state of economy with continued weak consumer sentiment, rising consumer price index and intense competition. It also reflects the additional costs incurred in the implementation of the transformation program and the harmonisation of our distribution system,” Lim said.

The group is intensifying its focus on enhancing its efficiencies and reducing cost to serve. It is also boosting innovations to meet the increasing needs of modern consumers towards healthier beverage choices.

Meanwhile, F&N chairman Tengku Syed Badarudin Jamalullail expects the economic environment in Malaysia and Thailand to remain soft and input costs in subsequent quarters are projected to increase following the uptrend in packaging, milk powder and sugar prices.