The group’s performance is bolstered by continued efforts in delivering innovative products with effective operational execution
by S BIRRUNTHA / pic by TMR FILE
FRASER & Neave Holdings Bhd’s (F&N) net profit surged 26% to RM86 million in its fourth quarter ended Sept 30, 2020 (4Q20), driven by strong export sales that mitigated the impact of a slight contraction in revenue.
The company, in a filing to the stock exchange yesterday, noted that revenue for the quarter dropped 2% year-on-year (YoY) to RM953.67 million, but earnings per share rose 26% to 23.5 sen.
Despite higher commodity cost, group profit before tax grew 21% YoY to RM108.3 million from prudent cost controls on overheads, and lower advertising and promotions spending.
“Excluding the gain on disposal of ‘TEAPOT’ trademark amounting to RM7.8 million and Covid-19 related expenses recognised in the current quarter, as well as other one-off or non-operating items in both periods, profit before tax improved by 15.1%,” it said in a statement yesterday.
Its CEO Lim Yew Hoe said the group’s performance this year is bolstered by continued efforts in delivering innovative products with effective operational execution to meet consumers’ expectations throughout the year despite challenging circumstances.
He added that while the group prioritises the availability of core products to the market, it continues to offer new healthier and better value products that resonate with its consumers.
He also noted that sustained demand for dairy products, boosted by in-home consumption, moderated the contraction in the food and beverage (F&B) sector’s performance this year.
The sector’s full year revenue declined 5.7% to RM2.04 billion, while its operating profit decreased 10% to RM144.9 million during the period under review.
Total exports from Malaysia and Thailand contributed RM796 million of revenue to the group this year, which was a noteworthy achievement in light of the pandemic.
Lim noted that the group would have overachieved its target group export sales of RM800 million in financial year 2020 in normal circumstances.
Moving forward, F&N said the group remains cautious amid the Covid-19 pandemic and local uncertainties as both local and global situations remain fluid and uncertain.
Lim said while the group is mindful of its operating environment, this pandemic has provided F&N an opportunity to reset and reimagine its business strategies to fuel growth and innovation.
“Maintaining business as efficiently as possible while safeguarding the wellbeing of our employees and the community remain a top priority.
“We will continue to focus on process improvements and digitalisation, and relentlessly pursue opportunities to build a stronger and more sustainable business for the future through continued investments in capital expenditure and our brands,” he added.
F&N announced a final single-tier dividend of 33 sen per share for this quarter, which is pending for approval by shareholders.
F&N’s share price closed at 0.07% or two sen higher at RM31.02 yesterday, valuing the company at RM11.38 billion.