CPFs Q1 profit jumped 40% as pig oversupply in Vietnam back to normal

Stocks and Financial Services Press Releases Monday May 13, 2019 14:51
Bangkok--13 May--CPF

Charoen Pokphand Foods Public Company Limited and the subsidiaries or CPF reported its total revenue year-on-year achieved Bt125.286 billion, up by 4% in the first quarter this year due mainly to an increased income from the overseas investment accounting for 67% of the total sale revenue and the remainder 33% from the business in Thailand.

The company's first quarter net profit also skyrocketed by 40% to Bt4.279 billion compared with the same period of last year. The rising profit derived mainly from pig business in Vietnam, Thailand and Cambodia has been improved since the price significantly dropped due to oversupply problem during the first quarter of last year. However, the situation now has returned to normal. It well management in production efficiency also raised positive effect to the company's year-on-year gross profit to increase from 9% to 14% in the first quarter this year.

Mr.Sooksunt Jiumjaiswanglerg, Chief Executive Officer for Agro Industrial Business and Co-President of CPF, pointed that the African Swine Fever (ASF) outbreak in Vietnam may affect to pig price around the area. Farmers would rush to sell pigs as worry of the virus which cause to oversupply problem shortly. However, the virus outbreak has decreased pig supply in those affected areas which will pull up the price due to shortage situation.

The company expects to achieve its annual goals. This is because improved overall performance has been compared to previous year, despite fluctuations of pork price in Vietnam market due to ASF.

In term of investment, the company is focusing on business expansion and value added products such as acquisition of HyLife, Canadian pork producer. The investment will allow CPF to access premium pork markets such as Japan and China. The purchase is expected to complete in the fourth quarter of this year.

The company sees opportunity to grow from overseas operations such as China, Vietnam, Russia, United States, the Philippines and etc. Its revenue targets to reach Bt800 billion or 6-7% growth per year in the next five years, while overseas sales will account for 75% of its total sales.

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