Delfi posts 33% rise in Q1 net profit to US$7.6m

CHOCOLATE confectionary company Delfi posted a 33.1 per cent increase in first-quarter net profit to US$7.6 million on a 15.1 per cent surge in revenue.

Earnings per share for the three months ended Mar 31, 2018 was 1.24 US cents, up from 0.93 US cent for the year-ago period.

First-quarter revenue was US$107.3 million, higher compared to US$93.3 million for the corresponding period last year.

Other operating income rose 74.4 per cent to US$1.3 million.

Delfi said the strong revenue growth was driven mainly by sales of its own brand products in Indonesia. Also bolstering its turnover was sales deferred from December 2017 as well as the run-up to the Muslim Lebaran festivities.

Its first-quarter gross profit margin was also 1.4 percentage points higher at 34.5 per cent, reflecting increased sales of higher-margin premium products and ongoing cost containment initiatives.

On Apr 13, Delfi entered into a deal to acquire for US$13 million from Hershey Singapore Pte Ltd the perpetual and exclusive licence to the Van Houten brand name for consumer chocolate and cocoa products in certain key markets in Asia and Oceania. With this acquisition, Delfi will control the rights to the Van Houten brand name in key markets in Asia. Hershey will retain the rights to Korea, India and the territory of the Middle East. The company said that this acquisition will open up opportunities for growth outside its regional markets.

With respect to claims that are tied to the disposal of the former Delfi Cacau Brazil Ltd to Barry Callebaut, the company maintained that the provision made for an exceptional charge of US$2 million in its FY16 financial statements is adequate.

"The Board and management believe there are grounds to resist these claims and the Company will keep shareholders updated as to material developments in relation to the Brazilian claims," it added.