GCB said it will remain focused on its core business in cocoa ingredient processing.
PETALING JAYA: Guan Chong Bhd
(GCB) will continue to prioritise its expansion plans while exercising conservative financial cost management.
The cocoa producer recently released the second tranche of its sukuk to raise money to pay for the company’s operating capital and capital expenditures.
Moving forward, GCB will remain focused on its core business in cocoa ingredient processing.
“At the same time, we are determined to optimise Schokinag-Schokolade-Industrie GmbH’s production according to market conditions while we endeavour to achieve better industrial chocolate sales margin to enhance our bottom line,” managing director and chief executive officer Brandon Tay Hoe Lian said.
GCB’s revenue grew by 11.3% year-on-year (y-o-y) to RM1.1bil on improved selling prices for cocoa solid and industrial chocolate ingredients in its first quarter of 2023 financial results (1Q23) ended March 31, 2023.
Earnings saw a 55.4% decline y-o-y to RM23.8mil or an earnings per share of 2.02 sen due to the lower margin of cocoa butter and increased finance cost.
On another note, GCB’s Ivory Coast cocoa grinding facility recorded a maiden operating profit of RM15.4mil on a revenue of RM144.8mil in 1Q23.
According to the group, the setting up of a grinding facility in Ivory Coast benefits GCB in terms of duty-free and quota-free of goods exported to Europe, as well as five years of zero corporate tax.
With the commissioning of the new Ivory Coast cocoa grinding facility in 4Q22, GCB said its overall annual grinding capacity has expanded by 22% to 337,000 tonnes from 277,000 tonnes, alongside grinding capacities in Malaysia, Indonesia and Germany.
“The group will allocate 40% of grinding capacity from the Ivory Coast plant to supply cocoa ingredients to our German industrial chocolate subsidiary to produce premium quality chocolate ingredients to meet the demand of the European market,” Tay added.
The modern facility seeks to contribute to GCB’s close-to-source strategy for grinding premium-grade cocoa beans.
