Fraser and Neave reported Wednesday its fiscal third quarter net profit increased 9 percent on-year to S$54.83 million on higher soft drink and dairy sales.
Revenue for the quarter ended 30 June rose 6.7 percent on-year to S$489.74 million, the beverage maker said in a filing to SGX.
For the beverages segment, profit before interest and tax (PBIT) jumped 128.40 percent on-year to S$6.66 million on revenue of S$133.03 million, up 11.56 percent on-year in the quarter, F&N said.
The revenue growth “was mainly due to growth in Soft Drinks Malaysia and Singapore,” F&N said. “Growth in Soft Drinks Malaysia was mainly due to successful Hari Raya festive campaign and trade loading of existing and new healthier products while revenue increases in Soft Drinks Singapore were mainly contributed by improved sales of 100Plus and its variants.”
The PBIT surge was mainly on the revenue growth, lower commodity cost and lower marketing spending, F&N said.
The diaries segment reported PBIT for the quarter rose 4.60 percent on-year to S$77.20 million on revenue of S$294.28 million, up 5.5 percent on-year.
For revenue, “Dairies Thailand recorded double digit growth mainly due to successful loyalty programs and campaigns for both domestic and export markets. Dairies Malaysia revenue increased due to continued efforts to strengthen the route-to-market amidst continuing price competition,” F&N said.
Performance was also supported by the share of profit from Vietnamese associated company Vinamilk, F&N said.
Dairies Singapore posted lower revenue due to a year-ago one-off supply contract.
PBIT for Dairies rose mainly on favorable input costs and lower marketing spending for Dairies Thailand during the quarter, the filing said.
Printing and publishing
The printing and publishing segment posted PBIT of S$7.40 million for the quarter, swinging from a year-ago loss of S$4.75 million, on revenue of S$62.33 million, up 2.65 percent on-year.
“Revenue was lifted by strong education orders and maiden revenue contribution from Print Lab,” F&N said, adding PBIT was positive on higher margins, prudent cost management, the Print Lab contribution and income from selling non-core assets.
“The group will continue its on-going efforts to diversify its printing and publishing portfolio to address the challenging business landscape. Leveraging on our strength as a major international content provider, publishing will continue to focus on international markets for growth opportunities,” F&N said.
F&N issued a cautious outlook.
“Consumer sentiments in the Food & Beverage segment is expected to remain challenging with continuing competition as well as volatility in foreign currency movements and raw and packaging material prices,” the company said.
“In Malaysia, conditions are expected to remain challenging given the intensifying competition especially in the canned milk segment and the implementation of excise duty on sugar sweetened beverages,” F&N said. “In Thailand, prospects are expected to be better following improvements in both sweetened and unsweetened condensed milk segment.”
For the nine-month period, F&N reported net profit increased 41.3 percent on-year to S$128.64 million on revenue of S$1.42 billion, up 3.5 percent on-year.
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