F&N posts 12.1% drop in Q1 net profit

FRASER and Neave Limited (F&N) recorded a 12.1 per cent drop in net profit for the first quarter ended Dec 31, 2016 to S$22.44 million as higher operating expenses offset the rise in revenue.

Revenue for the quarter rose 0.2 per cent to S$495 million, buoyed by higher revenue from the beverage segment and the dairies segment. The group's printing and publishing business, however, was a drag on revenue growth, given its 8.3 per cent drop in revenue to S$77.3 million.

Operating expenses rose 7.9 per cent from a year ago to S$143.4 million during the quarter.

F&N said it expects the operating environment for the printing and publishing segment to remain challenging in the near term.

But it expects the consumer demand in the Food & Beverage segment to remain subdued in its core markets.

"We continue to face downward pricing pressure from competition in our core markets in Singapore, Malaysia and Thailand while also facing upward costing pressure from high commodity prices," the group said.

"The group will continue to invest in Vietnam and Myanmar for our beverage business while seeking new opportunities in the Food segment."