Fraser and Neave posts fiscal 1H net profit dropped 18 percent

Fraser and Neave (F&N) 100Plus sports drinkFraser and Neave (F&N) 100Plus sports drink

Fraser and Neave (F&N) reported Friday its fiscal first half net profit fell 17.9 percent on-year to S$68.54 million amid rising raw material and energy prices.

The company also posted an exceptional charge of S$7.8 million, mainly from impairment of inventories and property, plan and equipment due to flash floods in Malaysia during the fiscal period.

Revenue for the six months ended 31 March edged up 2.2 percent on-year to S$1.01 billion on higher beverage sales volumes and price increases, the soft drink maker said in a filing to SGX.

“The soft start to FY2022 was not unexpected, given the challenges many industries are now facing worldwide. Raw material shortages, costs inflation, supply chain disruptions and rising energy prices have impacted our financial performance,” Hui Choon Kit, CEO of F&N, said in the statement.

“The outlook for the F&B industry remains bright. We believe the easing of the pandemic restrictions in Southeast Asia will pave the way for a revival of economic activity and release pent-up demand,” Hui added.

Segment performance

The food and beverage division posted revenue increased 3 percent on-year in the fiscal half to S$890.6 million.

The beverages segment, including beer and soft drinks, reported revenue rose 15 percent on-year to S$288.5 million, on higher selling prices and higher beer and soft drink sales volumes due to festive campaigns, product launches and export.

“The strong performance from beverages was partially negated by lower dairy volumes and unfavourable foreign currency translation, offset partly by higher selling prices,” F&N said.

“In Dairies Malaysia, lower revenue was due to reduced export orders from South America and the Africa region, impacted by shipping schedule disruptions and high freight costs,” the company said.

The dairies segment reported fiscal first half revenue fell 3 percent on-year to S$602.1 million.

In the publishing and printing division, revenue for the six-month period fell 7 percent on-year to S$107.7 million, F&N said.

“Softer textbook adoption, timing difference in international textbook sales, as well as lower print volumes from China printing plant due to disruptions caused by the Covid-19 pandemic adversely impacted P&P’s 1H2022 performance,” F&N said.

F&N declared an interim dividend of 1.5 Singapore cents a share, unchanged on-year.

Read more details of F&N’s performance.