LHI to expand Baker’s Cottage to 280 outlets by end-2023

A Baker's Cottage outlet in Petaling Jaya

KUALA LUMPUR: Leong Hup International Bhd (LHI) is ramping up its business-to-consumer channel via Baker’s Cottage in Malaysia and it targets to have 280 by end-2023 while it also expands its downstream operations in Southeast Asia.

LHI’s executive director and group CEO Tan Sri Francis Lau Tuang Nguang said on Friday that 136 outlets have opened to-date.

“Complementing the group’s downstream focus, a new poultry processing plant in West Java, Indonesia is being constructed and slated to complete by end of this year, ” he said in a statement released after the group’s virtual AGM.

In Vietnam, feed production is scaling up on the back of strong growth trajectory of livestock feed sales. This comes after the group’s acquisition of a feedmill in Dong Thap which specialises in aquatic feed production and further capacity expansion in Dong Nai feedmill, both in FY20.

LHI’s operations in the Philippines had entered its next chapter with the recent commissioning of its maiden feedmill in Sapang, Central Luzon.

Lau said this feedmill can produce up to 128, 000 tonnes per annum of feed and this provides another platform to strengthen its upstream segment in the country.

“With the resumption of economic growth, the group is poised to be a beneficiary of the recovery in income and consumption levels in our markets.

“To this end, we anticipate an improvement in performance across our markets in 2021, supported by the ongoing vaccine narrative and favourable demand-supply dynamics, ” he said.

Lau said ongoing efforts to enhance downstream integration are expected to yield greater resiliency, improve margins stability and thus create more value for the stakeholders.

On the group’s performance last year, he said the pandemic-induced disruptions on demand and supply gave rise to heightened volatility in the average selling prices of poultry products in its markets.

“Nevertheless, our footprint and strength as a major producer in our markets made it possible for us to ride out these harsh challenges to deliver overall growth in all key products, which is by no means an easy feat.

“In FY20, the group on an overall basis recorded sales volume expansion between 4% and 5% for day-old-chicks, broiler chickens and table eggs as compared to the previous financial year. This is a testament to the group’s strong execution and delivery capabilities, ” he explained.

Lau also said LHI remains committed to its “Farm-to-Plate” ambition as the group seeks to achieve further downstream integration and continuous organic growth in a consolidating market.

He pointed out as LHI emerges from the Covid-19 pandemic, these measures have strengthened LHI group’s current core business.

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