NEWS RELEASE
F&N GROUP RESILIENT DESPITE WEAK ECONOMY THANKS TO
STRONG BRANDS AND DISTRIBUTION
Final dividend of 29 sen net per share approved by shareholders
Fraser & Neave Holdings Bhd (F&NHB) grew its revenue by 1.7 per cent to RM3.74 billion and increased operating profit by 22.3 per cent to RM313.9 million for the year ended 30 September 2009. Profit after taxation surged 35 per cent to RM243 million on the back of strong performance of the Group’s soft drinks and dairies divisions. The commendable results mark the 9th consecutive year of achievement for the Group in its operating profits.
In recognition of its good performance for the year, the directors recommended a bonus tax exempt dividend of 5 sen per share on top of a final dividend of 24 sen which was approved by shareholders at the company’s Annual General Meeting held in Kuala Lumpur today. This brings the total net dividend for the year to 41.75 sen, an increase of 4.2 per cent compared to 40.08 sen paid last year. The final dividend will be paid to shareholders on 3 March 2010.
“The Group’s overall performance was commendable amidst a backdrop of a deep regional economic recession,” said F&NHB Chief Executive Officer Tan Ang Meng. “The increase in operating profit was due to the strong performance of the soft drinks and dairies divisions which maintained their momentum and together chalked up an impressive 31 per cent growth. Our soft drinks sales grew by 10.5 per cent boosted by a stronger volume demand. For the dairies division margins improved as it successfully defended selling prices in the premium market segment and shifted its product mix to take advantage of new opportunities arising from lower input cost.”
Tan said that attributable profit improved 35 per cent due to overall lower tax rate as the Group benefits from reinvestment allowance and other temporary differences.
Commenting on the performance of the core businesses, Tan said, ”The dairies division had a commendable year in which the operating profit improved by 59 per cent over last year to RM140 million and is now on par with the soft drinks as a key contributor to the Group profits. The plant at Rojana, Thailand has commenced operations and the groundbreaking of the Pulau Indah plant was held in late October 2009. This RM350 million plant when completed in 2012 will be the largest canned milk plant in Southeast Asia.
“The soft drinks division performed credibly and registered encouraging growth. Revenue edged 10.5 per cent to RM1.31 billion from RM1.19 billion last year due to the higher sales volume and a better product mix. Operating profits grew in tandem by 11 per cent to RM137 million from RM123 million.
“Glass division was affected by lower sales of the Thai plant and the closure of the Petaling Jaya furnace. In spite of these the division managed to register two per cent growth in operating profit. “
Commenting on the prospects for the coming financial year, Tan said "Economies of Malaysia & Thailand are forecasted to return to positive growth and this should be positive for F&N. However, prices of raw materials remain volatile and the recent increase in sugar price could erode margins. Nonetheless, with consumers’ interest in mind we intend to maintain price stability of our products in view of the recovering economy as well as the coming festive period. We would like all our loyal consumers to enjoy the festivities and not worry about a price increase at this point of time.”
Tan added that preparations are in full swing to launch new products and to strengthen distribution in the soft drinks division as management gears up for the expiry of the Coca-Cola transition agreement in Sept 2011. This includes the recent launch of a new corporate identity for the soft drinks division where its marketing and manufacturing arms are now known as F&N Beverages Marketing Sdn Bhd and F&N Beverages Manufacturing Sdn Bhd respectively.
“Overall, we are cautiously optimistic of the prospects for next year and will strive to sustain and build on current performance,” said Tan.
Fraser & Neave Holdings Bhd is a Malaysian company listed on Bursa Malaysia with F&B businesses in soft drinks, dairies and glass packaging. Property is a non F&B division. The Group employs nearly 5,000 employees in operations straddling Malaysia, Thailand, China and Vietnam.
ooOoo
Issued with the compliments of Fraser & Neave Holdings Bhd
by Eric Pringle Associates Public Relations Sdn Bhd.
For further information, please contact Art Thamboo / Elsy Tan
Tel: +60-3-21617144 / Fax: +60-3-21618209
E-m: art_thamboo@epapr.com.my/ elsy.tan@epapr.com.my