F&N chief executive officer Lim Yew Hoe
KUALA LUMPUR: Fraser & Neave Holdings Bhd
(F&N) has enjoyed the general rise in commodity prices but foresees challenges with increasing costs of raw materials, according to chief executive officer Lim Yew Hoe.
“Nevertheless, we have taken measures to address these challenges as these commodities are vital to our business,” he said in a statement.
Lim added that the F&B group remains vigilant and adaptable to market shifts and wider geopolitical and macroeconomic movements.
F&N’s net profit jumped 63.5% to RM165.4mil in the second quarter ended March 31 (2Q24) compared with RM101.2mil posted in the same quarter last year. Earnings per share stood at 45.20 sen from 27.60 in 2Q23.
Revenue for the quarter rose 12.1% to RM1.35bil against RM1.2bil mainly due to the phasing of sell-in for Chinese New Year and Hari Raya coinciding in 2Q24 compared to the previous quarter.
In the first six months to March 31 (1H24), it posted a higher net profit of RM336.1mil on revenue of RM2.7bil.
Group operating profit for 1H24 increased by 18.8% to RM416.8mil on the back of higher revenue and better margins from both F&B Malaysia and F&B Thailand.
Excluding one-off non-operating items primarily due to RM89.3mil fair value gain recognised from the remeasurement of previously held equity interest in Cocoaland in 1H23, the adjusted group operating profit increased by 60.9% to RM412.9mil despite escalating input costs for certain key commodities.
“Despite challenging market conditions, our strategic choices have proven effective. Crucially, we regained volume growth in sales of our key products. Our investments in supply chain optimisation and solar PV system have also yielded long-term benefits in cost, and operational efficiencies and carbon footprint reduction,” Lim said.
“In addition to diversifying our product range, Halal Packaged Foods have been steadily contributing to the group’s top and bottomline growth. As we continue our efforts in consolidating our packaged food manufacturing to leverage its synergies with the rest of the group, we are also developing a confectionery hub that will further boost our packaged food portfolio and strengthen our exports,” he added.
In line with the group’s performance, the board declared an interim single-tier dividend of 30 sen per share for the financial year ending Sept 30, 2024. This dividend amounting to approximately RM110.0mil will be paid on May 31.
