F&N profit edges up 1% for 9M on higher beverage and dairy sales

BEVERAGE and publishing company Fraser and Neave (F&N) on Thursday posted a net profit of S$119.1 million in the nine months ended June 30, up 1.0 per cent from the year before on higher beverage and dairy sales.

Revenue for the three quarters was S$1.5 billion, up 5.8 per cent from the same period the preceding year, with beverages revenue rising 8 per cent and dairies revenue rising 5 per cent.

Profit before interest and tax (PBIT) from beverages rose 76 per cent to S$26.3 million, thanks to Emerald Brewery's maiden profit contribution, favourable pack mix, savings from cost-cutting measures as well as lower advertising and promotions (A&P).

PBIT from the dairies division however, fell 9 per cent to S$190.8 million, due mainly to dairies Malaysia, where freight and input costs rose. Profit share from Vinamilk fell. Dairies Thailand was a bright spot though, as earnings grew 3 per cent on the back of higher sales and lower A&P. This was despite "higher input costs", said F&N.

PBIT from the publishing and printing division was negative S$8.8 million, narrowing from a loss of S$19 million last year. This was due to savings generated from cost-cutting measures.

Earnings per share was 8.2 Singapore cents, up from 8.1 cents in the nine months last year.

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F&N said on Thursday that it expects the Delta variant to impact its business, and will take a cautious outlook for the rest of the year. It is looking to "strengthen its halal position", and has acquired the Sri Nona Group for cash consideration of RM60 million (S$19 million).

"(This acquisition) complements F&N's current product offering to consumers, as well as builds a new growth pillar."

F&N shares fell one cent or 0.7 per cent to S$1.43 on Thursday before the results were announced after market close.