CP Meals stories enterprise restoration for the most recent quarter

For Thailand-based Charoen Pokphand Meals (CP Meals), enhancements in monetary efficiency over the previous quarter symbolize a restoration within the multinational agri-food group’s companies.

For CP Meals, 2023 was a difficult 12 months for the enterprise, in response to CEO Prasit Boondoungprasert. Nevertheless, he mentioned, the outcomes for the second quarter of 2024 and for the half-year display that the corporate’s enterprise has returned to regular, and efficiency surpassed expectations.

Whereas prices of manufacturing and meat output soared final 12 months, he mentioned that the corporate had been capable of management prices in current months, and to make inexpensive meals obtainable in the marketplace. These objectives have been achieved because of cautious monitoring of the market and shopper conduct, and effectivity good points throughout the enterprise. 

Second-quarter outcomes surpass expectations

For the three months, CP Meals stories web revenue of virtually 6.93 billion Thai baht (THB; US$202.7 million). This was attributed notably to the group’s worldwide companies, and resulted in a close to 10-fold enhance for this metric in contrast with the identical interval of 2023, when a web lack of THB793 million was reported.

Of the full gross sales income for the most recent quarter of just below THB150 billion, 64% derived from the group’s abroad companies, and 36% from its Thai operations (comprising 30% home gross sales, and 6% exports).

Gross revenue margin reported for the interval of round 15% was pushed primarily by decrease animal manufacturing prices — notably for uncooked supplies — in response to the corporate. Additionally supporting the pattern have been enhancements in price administration and manufacturing effectivity, and better costs for pig meat. The latter growth utilized particularly in Cambodia and Vietnam, and resulted from a brand new steadiness in pork markets, in addition to to the African swine fever epidemic.

From CP Meals’ affiliate enterprises and joint ventures, revenue for the interval was up by greater than an element of 4 from the comparable quarter at THB3.35 billion. Underlying this enchancment have been optimistic developments within the firm’s pig and animal feed companies — together with larger pork costs year-on-year — within the Individuals’s Republic of China, in response to the corporate. 

Half-year outcomes: gross sales dip however earnings larger in 2024

Among the many headline figures within the outcomes for the half-year (to June 30, 2024) was a 2% year-on-year drop in gross sales income to THB289.5 billion. This was attributed by CP Meals to the restructuring of its enterprise in Poland, and the divestment of built-in broiler farms in China.

Nevertheless, the group stories important enhancements for the six months by way of profitability. From 10.2% for the primary half of 2023, gross revenue margin elevated to 13.8% up to now this 12 months. For CP Meals, this was attributable to a mixture of upper pork costs in Vietnam and Cambodia, and a widespread discount in farm manufacturing prices.

At virtually THB8.08 billion for the first half of 2024, web revenue had improved from a detrimental determine of THB3.52 billion on the similar level final 12 months.  

For all 4 of the corporate’s primary enterprise sectors, gross revenue margin was reported larger for the primary half of 2024 than in 2023.

Contributing essentially the most to complete income for the half-year (THB289.5 billion) was the “Abroad-Livestock” enterprise. It achieved 3% year-on-year enhance in gross sales to THB159.8 billion. Gross sales for “Thailand-Livestock” have been reported at THB94.0 billion, “Abroad-Aqua” at THB22.9 billion, and “Thai-Aqua” at virtually THB12.9 billion. These figures represented year-on-year reductions of 4%, 11%, and 12%, respectively.

By product class, “Farm” generated virtually THB160.1 billion in CP Meals’ gross sales income for the half-year, “Feed” THB66.47 billion, and “Meals” THB63.0 billion. Whereas the figures for “Farm” and “Meals” have been hardly modified from the identical interval in 2023, feed gross sales have been down 8%, probably because of decrease feed ingredient costs. 

Extra of CP Meals

Annual slaughtering of round 685 million birds places CP Group nicely throughout the prime 20 largest poultry corporations on the earth, in response to WATTPoultry.com’s High Poultry Firms survey. Producing geese, desk eggs (from 22 million hens), and egg merchandise in addition to chickens, the Thailand-based firm is the third largest poultry meat firm in Asia.

For the most recent full monetary 12 months (2023), CP Meals reported web gross sales of THB585.8 billion, which was 5% decrease than for the earlier 12 months. At round THB47.6 billion, Earnings Earlier than Curiosity, Taxes, Depreciation, and Amortization (EBITDA) for 2023 was down 28% year-on-year, and EBITDA margin dropped 2.7 share factors to eight.1%. For the reason that lows recorded within the fourth quarter of 2023, quarterly revenue margins have improved considerably for the corporate’s livestock and aquaculture companies, each in Thailand and for its worldwide pursuits.

Earlier this 12 months, CP Meals welcomed the Thai authorities’s announcement of measures to ease imports of soy into Thailand.  

To help the Bangkok metropolis authority’s technique on environmental enchancment, CPF was reported to be reworking vacant plots within the capital metropolis into inexperienced areas for recreation and studying.   

In Might this 12 months, CP Meals secured 5 prestigious regional honors on the 2024 Asian Excellence Awards.