Thai Union’s first quarter revenue hits record high

Thai Union Group Plc, a seafood and pet food producer, reported record-high revenue of 36.3 billion baht in the first quarter of 2022, amounting to a 16.5% increase compared to the previous year.

The two key growth drivers for the Thai Union Group are rooted in a favourable foreign exchange and robust global demand as many countries continued their return to normalcy and reduced pandemic restrictions.

The firm also posted a 15.4% increase in gross profit to 6.4 billion baht yearon-year, though net profit actually decreased 3.2% to 1.7 billion baht as a result of inflationary pressures and ongoing supply chain and global logistics constraints.

“While the firm faces persistent challenges, I am pleased that we were able to deliver a strong quarterly result and top-line growth across our three core business units,” said chief executive Thiraphong Chansiri.

He added that the firm’s strict Covid19 measures have allowed it to continue managing its global production network well while simultaneously delivering quality and nutritious food products to consumers around the world.

Robust global demand was reflected in higher sales across all segments, with sales for ambient seafood growing 14.3% to 15.5 billion baht during the quarter, supported by both stronger sales volumes, particularly for shrimp products in Asia, favourable foreign exchange, the recovery of the food service sector in the US and Europe and an increase in selling prices.

The firm also reported that automation has helped improve production efficiency and manage cost per unit.

Meanwhile, the PetCare unit and other value chain businesses continued to play a significant part in the firm’s growth in the first quarter, with sales jumping 27.2% to 7 billion baht, as people continued to spend more on their pets.

As for expansion, Thai Union has continued to grow in various markets and sectors, including establishing a joint venture company, RBS-TU Food Ingredients Private, with R&B Food Supply Plc (RBF) and Srinivasa Cystine Private Limited (SCPL), an associate of Avanti Group, to provide high-quality food ingredients to the Indian market.

Thai Union also took steps to better manage its supply chain over the quarter by launching a new joint venture with Pacific Cold Storage Co, a subsidiary of JWD InfoLogistics Plc.

The new company, Pacific TUM Cold Storage Co, will build a cold storage facility in Samut Sakhon province to handle Thai Union’s growing raw materials.

“Business diversification remains a key strategy for us as we continue to invest and expand our business into high-margin areas where we can use innovation to create greater value and optimise materials processed in our plants,” said Mr Thiraphong.