F&N posts Q3 net profit of Rm93.85mil

PETALING JAYA: Fraser & Neave Holdings Bhd’s (F&N) net profit for its third quarter ended June 30, 2020 dropped 18% to Rm93.85mil compared with Rm114.94mil in the previous corresponding period, due to the adverse impact of the Covid-19 pandemic and movement control order (MCO) measures on consumer demand.

Revenue in the third quarter was lower at Rm918.07mil compared with Rm1.07bil a year earlier.

In a filing with Bursa Malaysia yesterday, the food and beverage (F&B) company said quarterly revenue for domestic operations declined by 21.2% with flat monthly sales, unlike previous years where sales increased in the run-up to the Hari Raya festive season.

“Beverages sales were particularly affected while Dairies sales were less affected.

“With MCO and the restrictions imposed on dine-ins, sales to our hotel, restaurants and cafes (Horeca), convenience stores and general trade channels were affected significantly.

However, these have been mitigated by increase in sales to modern trade channels.”

Since the government eased the MCO restrictions from early May, F&N said its F&B business has seen gradual improvement in sales and stock movement.

As for its Thailand operations, F&N said quarterly revenue declined by 7.7% (11.1% in Thai baht terms) to Rm455.8mil, mainly impacted by a contraction in sales in domestic and Indochina markets and partially offset by growth in exports.

“With the pandemic outbreak, Thailand’s domestic revenue contracted by 14.7% (in Thai baht terms) compared with the previous year, especially in Horeca general trade channels.

“The decline was partly due to higher stocks in trade as products were front-loaded in the second quarter ahead of the emergency decree implemented in Thailand from March 26, 2020” said F&N.

For the nine-month period ended June 30, 2020, F&N’S net profit stood at Rm324.39mil compared with Rm342.23mil in the previous corresponding period, while revenue dipped to Rm3.03bil compared with Rm3.10bil a year earlier.

Commenting on its prospects, F&N said it has been a challenging time for many companies as the Covid-19 pandemic and the containment measures have taken their toll on the economy.

“While we believe our strong business fundamentals will see us through this crisis, we are mindful that globally the war against the pandemic is far from over. We will continue to be vigilant and have taken the necessary measures in our offices and factories to safeguard our staff well-being.

“In the longer term, we believe this pandemic is an opportunity for reset and a catalyst for change. We will need to be future-focused to ensure we can emerge stronger from this crisis. This will include process improvements and digitalisation.”