F&N Q1 net profit falls 29% to S$28.6 million

MAINBOARD-LISTED drinks maker Fraser and Neave (F&N) reported on Tuesday (Feb 7) a 28.8 per cent year-on-year decline in net profit for its first quarter despite higher revenue.

Net profit for the three months ended Dec 31, 2022 fell to S$28.6 million from S$40.2 million in the corresponding period a year earlier, the company said in a business update filing on the Singapore Exchange. On a per-share basis, earnings fell to S$0.02 in Q1 FY23 from S$0.028 in Q1 FY22.

The group’s profit before interest and taxes also dropped 22.1 per cent on year in the first quarter to S$56.8 million, with the beverages and dairies segments contributing most to the decline.

Beverages earnings tumbled 33 per cent despite better sales as higher input costs and increased advertising and promotion spend impacted profits and margins. Meanwhile, dairies earnings fell 18 per cent, hit by higher input costs.

F&N’s revenue grew 5.6 per cent on year during the first quarter to S$532.6 million, with beverages contributing most to revenue growth. The group noted that beer sales had doubled, while the execution of festive campaigns and early sell-in for Chinese New Year supported soft drinks growth.

The group had cash of S$345.1 milllion as at Dec 31, 2022, while borrowings stood at S$1.09 billion. F&N had total equity of S$3.4 billion, with gearing at 21.6 per cent, and the group noted it has “generous debt headroom for acquisitions”.

SEE ALSO

F&N full-year earnings down 11.1% to S$124.9m despite higher revenue

DECODING ASIA

Navigate Asia in
a new global order

Get the insights delivered to your inbox.

F&N shares fell 1.7 per cent or S$0.02 on Tuesday to close at S$1.19, before the business update.