Profit before tax surged 63% to $36.3 million, underpinned by higher dairy and soft drinks sales, reduced operating costs and maiden profit contribution from the group’s 19.96% stake in Vietnam Dairy Products Joint Stock Company (Vinamilk), an associate company.
Profit after taxation, however, rose 28% to $30.1 million from $23.4 million in the last corresponding period, mainly due to higher financing cost.
F&N says broad-based sales across business segments in the core markets of Singapore, Malaysia and Thailand contributed to group 2Q18 revenue growth.
Aided by a later Lunar New Year as well as effective festive-led promotions, sales of Beverages in 2Q18 grew 11% to $125.6 million. Beverages also narrowed its losses to $0.8 million in 2Q18, from a loss of $5.2 million in 1Q18.
Dairies, led by higher export volume and favourable translation effects, recorded a 5% increase in 2Q18 revenue to $284.4 million. Bolstered by Vinamilk’s $16.2 million earnings contribution, 2Q18 earnings from Dairies grew 30%, to $51.6 million.
This quarter, Dairies remained the group’s strongest performer – especially Dairies Thailand and Dairies Singapore where earnings grew 6% and 44%, respectively. However, earnings from Dairies Malaysia were hurt mainly by higher dairy-based commodity prices and packaging cost.
Revenue from Printing and Publishing came in at $63 million, 4.6% lower compared to the year ago period. Losses for the division increased to $8.4 million.
F&N says it will continue to invest in new markets and develop new product offerings and innovations while maximising the benefits of capex projects and harmonised distribution network. Key packaging and raw material prices, other than sugar, are on the rising trend and remains volatile. However, the group has already largely locked in prices for the current financial year and will continue to be vigilant of volatile price movement. The group will also continue to pursue new investment opportunities.
F&N has declared an interim dividend of 1.5 cents per share, unchanged from the interim dividend declared a year ago. The dividend will be paid on June 12.
Shares in F&N closed 1 cent higher at $2.03 on Tuesday.
