Dairy Farm FY16 profit rises 10.5% on better food margins, contributions

DIVERSIFIED retailer Dairy Farm International's net profit rose 10.5 per cent to US$469.0 million in 2016 as margins improved in its food and Ikea businesses and contributions rose from associates and joint ventures.

For the 12 months ended Dec 31, earnings per share was 34.69 US cents. The company is proposing a final dividend 14.5 US cents per share. Dairy Farm shares closed at US$8.44 on Thursday before the results were announced.

Sales from subsidiaries increased by 0.6 per cent to US$11.2 billion, with gains in health and beauty and home furnishings offsetting a decline in food. Contributions from associates and joint ventures, notably the Yonghui Superstores grocery chain and the Maxim's restaurant line, rose 39.1 per cent to US$118.2 million, to give the bottom line a boost.

The company described a "significant degree of economic uncertainty" in the year ahead, and said it would continue to focus on profitable business approaches while innovating and modernising its infrastructure.