When it comes to doing business, knowing your home ground is an advantage. Yet, for Singapore-headquartered Food Empire Holdings, success has come from distant markets beyond local shores, where the company’s tenacity and strategic investments have paid off handsomely.

Known for its MacCoffee instant coffee mixes, Food Empire achieved the rare distinction of topping all categories in its industry classification in this year’s Centurion Club: returns to shareholders, growth in profit after tax and best in weighted return on equity over the last three years. This clean sweep makes it the overall sector winner in the Consumer Defensive industry classification as well. 

For good measure, Food Empire’s performance has also made it the overall winner among all Centurion Club members. So strong is its growth momentum that technically, Food Empire has entered the big league Billion Dollar Club after its market cap crossed the $1 billion mark in June, with further gain to reach $1.27 billion as of Oct 31.

Brief history

The company’s expansion into Eastern Europe began in 1989 when executive chairman Tan Wang Cheow distributed computers and accessories to the region. These items were later sold in Russia. The company’s foray into instant beverages came in 1992, when Food Empire introduced three-in-one coffee to distributors from Kazakhstan during a meeting in Bangkok. The company subsequently continued this trading business to Russia as well.

In 1993, Tan met group CEO and executive director Sudeep Nair. At the time, Tan was supplying computers and software to the garment firm where Nair worked. Later, Nair joined Tan’s business and relocated to Singapore from Bangkok. Tan’s business, established in 1982, had focused on exporting electronics, computers and accessories such as hard disk drives and printers to Eastern Europe.

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In 1994, the company decided to develop its own brand of coffee mixes. Food Empire’s first test product, a three-in-one instant coffee mix under its now flagship MacCoffee brand, received positive responses.

To expand Food Empire’s business, Nair moved to Moscow at the end of 1994, where he started with a small team.

At the time, Russia was grappling with economic instability and political disarray following the Soviet Union’s dissolution in 1991. The team also faced challenges, such as educating a tea-drinking population and attracting talent, given the absence of a ready pool of professionals in the fast-moving consumer goods (FMCG) industry before 1991.

Yet, the team recognised an opportunity to introduce new products to a newly liberalised market. “Russian entrepreneurs were all looking for opportunities and it was the same with consumers,” says Nair.

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Nair recalls how FMCG brands and products from all around the world were trying to break in. Some were already well-known international brands but unknown to Russians. “That was what made me feel positive that we stood a chance to establish a brand in Russia,” he adds.

With a small marketing budget and despite no command of Russian, Nair set out to build brand awareness. After living in Moscow for a few months, Nair observed that the underground metro, then used by over 9 million passengers, was an untapped advertising channel. He engaged a local agency and launched a campaign featuring creative visuals that explained the concept of coffee mix while showcasing the MacCoffee brand. Stickers were placed in wagons across the metro for a few months. 

The campaign proved effective. Within months, sales soared as brand recognition surged. “There was no turning back,” says Nair. A TV campaign followed the metro marketing campaign. MacCoffee became the go-to coffee-mix brand in Russia. “We focused on memorable advertising, sports broadcast sponsorships, and making MacCoffee widely available.”

From Russia, Food Empire moved into the adjacent markets of other former Soviet republics. Similarly, these markets had just opened up, and MacCoffee practically defined a product category on its own. 

The caffeine high fuelled further growth ambitions. In 2012, the company turned its attention to Myanmar, Vietnam, the Philippines, and Malaysia, which were already large, well-established markets for coffee mixes but had been missed by Food Empire. In Vietnam in particular, the team saw the potential of a large coffee-consuming market, a stable economy, a large, growing, younger population, and a strong coffee culture.

However, unlike Russia, where Food Empire enjoyed a first-mover advantage, the company had to adapt its brand strategy to stand out among well-entrenched competitors.

After testing the markets in Myanmar, the Philippines, and Vietnam, the team found the most success in Vietnam, where it identified a market gap. Today, Food Empire sells Vietnamese iced coffee packets under the MacCoffee CaféPHỐ brand. Vietnam, under Food Empire’s Southeast Asian segment, has emerged as its fastest-growing market in 1HFY2025, with revenue of US$77.5 million ($100.1 million), up 25.3% y-o-y. It is now Food Empire’s second-largest market in terms of revenue, behind Russia and ahead of Ukraine, Kazakhstan and the CIS.

Billion-dollar brew

In April 2000, Food Empire listed on the Singapore Exchange’s (SGX) Mainboard, offering 86 million new shares at 13 cents apiece. Back then, the initial public offering (IPO) valued Food Empire at close to $45 million. At the time of its IPO, the group had five brands, MacCoffee, Temasek Royal, Klassno, Express and Fesbrew. The portfolio has expanded to 18 today, including new product categories such as potato chips under the brand Kracks. 

Nair explains that an SGX listing was a “natural” choice, despite its scant local market presence. “Singapore remains our home base and provides a stable environment for investors, talent, and corporate oversight. The 2000 listing helped position the company for further international expansion,” says Nair, noting that the company’s revenue was just US$50 million at the time of listing.

The growth since then clearly did not come by naturally. Nair says that establishing new categories or new product lines and brands in markets is “challenging”, but it “can be rewarding” if done right.

“Our business model of owning our brands and establishing distribution networks deeply inside our markets has played a vital role in our growth. This approach, strengthened over the last 15 years through our carefully planned and executed investmnets in vertical integration to manufacture instant coffee and non-dairy creamer, has led to the results we see today,” he continues. 

From US$50 million at the time of listing, Food Empire’s revenue for FY2024 ended Dec 31, 2024, reached US$476.3 million, up 11.9% y-o-y, while earnings were down 7% y-o-y to US$52.5 million on higher costs. 

In 1HFY2025, Food Empire’s revenue rose by 21.7% y-o-y to US$274.1 million and a normalised profit after tax of US$31.5 million, which excludes the one-off, non-cash component of the redeemable exchange notes (REN) of US$32.6 million. The fair value loss was due to a significant increase in Food Empire’s share price, from $1.09 to $1.84, as at June 30. The REN was sold to Ikhlas Capital, led by former CIMB chairman Nazir Razak. Besides the additional funding, Food Empire has strengthened its connections through this investor to expand its business network across the region. 

Aiming for long-term growth

When asked about Food Empire’s secret to success, Nair attributes it to several factors, including its focus on building strong brands and building distribution channels that allow the team to connect with its consumers directly. “We have always adapted our products and marketing to local tastes, and invested in people and local teams. By maintaining consistency in quality, we have earned the trust of consumers and our partners,” he says.

Food Empire’s vertically integrated business model, which has enabled the company to better control costs and quality, is another key to its success.

Recounting his time in Russia, Nair says the biggest lessons were patience, consistency in quality and having local insights. “The Russian experience taught me first-hand that everything we do must be seen from the local consumer’s perspective and never from overseas. Every country is unique, and to be successful, one has to think local.”

“The Russian market was, and still is, very dynamic and changing every few years, but we have established a strong brand that consumers love,” he says. “I owe my success to the team that I built and groomed over the decades and our determination to keep pushing and growing. We competed with the best MNCs and local brands, and the passion and hard work of the team have enabled us to maintain our leadership position.”

Looking ahead, Food Empire believes it is well poised for further growth, with numerous investments to boost capacity and step up marketing. “The rate of growth may change from year to year as there would be periods of consolidation to optimise or balance growth rates with profitability,” says Nair. “We are also mindful that business or markets could be subject to geopolitical events or pandemics like we have seen, but we have also proven that despite such external shocks, Food Empire has a fairly sustainable and growing business and runs a resilient model.”

“Food Empire is now reaping the benefits of investments in capacity expansion projects that were made over the past 10 years. However, we are not stopping here; we have already embarked on a new phase of investments to build a robust project pipeline, which will then support our next phase of growth. Then, we will move on to the next phase of investment.  This will sustain our growth in the long run,” he adds.