F&N’s 2Q profit down on commodity price pressures and forex loss, declares 27 sen dividend

KUALA LUMPUR (April 27): Fraser & Neave Holdings Bhd’s (F&N) net profit fell 9.32% to RM93.87 million for the second quarter ended March 31, 2022 (2QFY22), from RM103.51 million a year ago, on commodity price pressures and forex translation loss from a weaker baht.

Earnings per share dropped to 25.60 sen from 28.20 sen, the beverage company’s filing with Bursa Malaysia showed.

Revenue inched up 1.47% to RM1.11 billion from RM1.09 billion, supported by Malaysia’s food & beverage improved performance.

On a quarter-on-quarter basis, the net profit and revenue were little changed from the RM92.95 million and RM1.11 billion reported for 1QFY22.

F&N declared an interim dividend of 27 sen per share, to be paid on May 31.

For the first half of FY22, the group’s net profit declined 22.26% to RM186.82 million from RM240.32 million in the same period of FY21, on the back of higher commodity prices, flood impact, and forex translation loss from a weaker baht.

Six-month revenue increased marginally by 1.81% to RM2.21 billion, from RM2.17 billion.

F&N chief executive officer Lim Yew Hoe said the results demonstrate the group’s resilience in the face of tremendous pressures on multiple fronts.

He said the rise in global commodities prices amounted to an additional RM200 million cost of goods sold (COGS) for the first half year.

Through rigorous cost management measures, including price and trade discount adjustments, the group has significantly reduced the impact to its bottom line, he added.

“We will focus on accelerating the momentum built in the first half, while keeping a tight rein on costs and adapting to the fluid environment.

“We are confident that the fruits of our strategic plans will enable us to come out on a stronger footing when the markets stabilise again,” said Lim.

He added that for the longer term, F&N is on track for several other capital expenditure projects that will enable the group to capture value in new market segments.

“Our new RM20 million drinking water production plant and warehouse in Kota Kinabalu signal our confidence and commitment to grow the drinking water business in Sabah,” he said.

Shares in F&N finished 14 sen or 0.61% higher to RM23.00 on Wednesday (April 27), valuing the company at RM8.44 billion.