F&N eyes halal market on major acquisitions

The group acquires Sri Nona Food Industries, Sri Nona Industries and Lee Shun Hing Sauce Industries

By AZALEA AZUAR / Pic TMR FILEPIX

FRASER & Neave Holdings Bhd (F&N) aims to grow its footprint in the halal food space after acquiring three food and beverage (F&B) companies worth RM60 million.

The fast-moving consumer goods producer acquired Sri Nona Food Industries Sdn Bhd, Sri Nona Industries Sdn Bhd and Lee Shun Hing Sauce Industries Sdn Bhd to add established Malaysian food brands to its portfolio of renowned brands.

“Our latest investment will serve as a platform to expand into more halal food segment and meet the rising demand for convenience and ready-to-eat food products.

“With our robust research and development capabilities, we are confident the new acquisitions will help us grow our halal food categories, complement our offerings, introduce more innovative products and increase our profit margin in the long run,” said F&N CEO Lim Yew Hoe (picture) during F&N’s virtual 59th AGM yesterday.

F&N continues to penetrate into different order fulfilment options to strengthen its competitive edge after scaling up its e-commerce operations last year.

“We have recently opened F&N Life fulfilment centre in Kuala Lumpur, which provides more choices to consumers such as self-pickup options and express next day deliveries for our online shoppers. In the future, we aim to set up more F&N Life fulfilment centres throughout Malaysia to create a seamless consumer experience,” Lim mentioned.

In an earlier report by The Malaysian Reserve, the group’s fourth-quarter of 2020 net profit increased 26% to RM86 million, supported by strong export sales that mitigated the impact of a slight contraction in revenue.

Its 4Q revenue dropped 2% year-on-year (YoY) to RM953.67 million, but earnings per share rose 26% to 23.5 sen.

F&N’s group profit before tax grew 21% YoY to RM108.3 million from prudent cost controls on overheads, and lower advertising and promotions spending.

The group’s full-year revenue dropped to RM2.04 billion, while its operating profit declined 10% to RM144.9 million during the period under review.

On the other hand, F&B Thailand continued to contribute strongly despite challenges caused by the Covid-19 pandemic and the ensuing emergency decree, delivering over 70% of the group’s bottomline in financial year 2020 (FY20).

The group believes that its business in Thailand will continue to demonstrate resilience and agility in FY21 to support its strategies moving forward despite the country’s situation remaining fluid.

Lim stated that managing Covid-19 has enhanced the group’s state of preparedness to safeguard its business and people’s wellbeing in times of uncertainties.

“Since the earliest stages of Covid-19, we have been working closely with local authorities and business partners to respond to additional needs from the pandemic,” he said.

Moving forward, F&N has invested in a variety of initiatives to drive innovation and business sustainability in order to support its growth.

It funded renewable energy programmes worth RM30 million, which include the 10MWp solar roof project at its Shah Alam, Pulau Indah and Bentong plants.

There are also three ongoing capital expenditure projects expected to be completed in FY21.

The projects include a RM182 million integrated warehouse in Shah Alam, Selangor, equipped with an automated storage retrieval system (ASRS), and a 20,000 sq m regional distribution centre in Rojana, Thailand, to be fitted with a RM40 million ASRS.

The commencement of a RM20 million 200 bottle per minute drinking water line and warehouse at the Kota Kinabalu Park in Sabah is expected to take place soon.