Tax incentives lift F&N net profit in Q1 


KUALA LUMPUR: Fraser & Neave Holdings Bhd (F&N) reported lower revenue and operating profit in the first quarter ended Dec 31 due to Covid-19 challenges and higher raw material prices, but tax incentives enjoyed in Thailand boosted the group's bottomline.

Net profit rose to RM136.8mil compared with RM128.3mil made a year ago. Sales fell to RM1.08bil from RM1.11bil.

The group's business in Thailand generated RM514mil in revenue, while Malaysia accounted for RM568mil.

Operating profit was RM156.7mil compared with RM157.9mil previously, the company said in a filing with Bursa Malaysia today.

"The Group remains cautious of the local and global uncertainties as the COVID-19 pandemic situation remains fluid and uncertain," it said.

The company said skimmed milk prices have increased since last year and have remained high.

"Other commodity prices have also been generally on the uptrend," it said.

The company is also facing logistical challenges that its hampering its export growth.

"Some of our export markets have also been affected by higher freight charges due to shortage of shipping containers," F&N said.

The group said it is looking beyond the current pandemic and is exploring ways to “reimagine” its businesses through organic and inorganic growth to ensure a more sustainable future.

"We have sharpened our route-to-market and channel strategies to fulfil our consumers’ needs and expectations. We will strengthen and scale up our e- commerce operations to ride on this fast-growing channel," it said.

The recent acquisition of Sri Nona Companies was part of the group's strategy establish Halal food as its new pillar of growth.

"For exports, we remain focused on growing our sales in existing markets and expanding to new markets while adapting and refining our strategies to constraints imposed by the pandemic," it said.

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