Caption: Thai Union Family of Brands (photo credit: Thai Union)
- 3Q18 sales of THB 34.1 billion, down 1.9 percent from a year earlier, and 3Q18 gross profit of THB 5,378 million, up 14 percent quarter-over-quarter
- Gross margin improved to 15.7 percent in 3Q18 from 14% during 3Q17
- Stable raw tuna material prices contribute to the gross margin improvement while tuna business is the main driver for recovery
- Strong operational cash flow of THB 10,651 million
- Strategic repositioning of Scottish salmon operations leads to impairments of THB 420 million
5 November 2018, BANGKOK – Thai Union Group PCL (Thai Union) reported a 1.9 percent year-on-year decline in 2018
Gross profit improved significantly from
Thai Union's ambient seafood sales in 3Q18 were THB 16,806 million, up 0.4 percent year-on-year. Sales contribution from the frozen and chilled seafood business fell 8.1 percent year-on-year to THB 13,037 million, and PetCare and value-added product sales fell 5.4 percent to THB 4,331 million over the same period last year due partly to Thai Baht appreciation against the US dollar at 1.2 percent year-on-year.
In the first three quarters of 2018, North America contributed 39 percent of total sales, followed by Europe at 31 percent, the Thai domestic market at 10 percent, and other markets at 20 percent.
Tougher market competition in North America, together with US dollar depreciation, saw the sales of frozen and chilled seafood, particularly shrimp and lobster, decline in value while
However, China and the Middle East continued to grow, with sales contributions improving due to the launch of new products and strong marketing and sales efforts.
The operating profit is THB 1,834 million, up 33.1 percent year-on-year. The stringent cost control prompted one percent selling, general and administration (SG&A) expense decline year-on-year. However, the SG&A to sales ratio increased to slightly to 10.4 percent in 3Q18, compared to 10.3 percent in the same period last year due to revenue weakness.
Strong working capital management and the improved operational EBITDA of THB 3,221 million in 3Q18. Thai Union reduced net debt to equity ratio to 1.40 times in
"We increased our gross profit margin and net profit was the best since 2015, resulting from solid operation support, significant operational improvement
"Thai Union will continue to expand its business portfolio through business diversification while continuing aggressive development of product innovation," Chansiri added.
Thai Union has recently introduced Thammachart Seafood's premium seafood store, The Lobster Lab, at Alibaba's retail chain Hema in Shanghai, China. This take-out and sit-down restaurant concept serving live lobsters from North America
In Europe, Thai Union's Marine Ingredients business unit has recently commissioned a state-of-the-art fish oil refinery plant in Rostock, Germany to produce the high-value refined tuna oil which is high in DHA, one of the key components in infant formula, dietary supplements and clinical nutrition. Completing the "Dock to Door" tuna oil supply chain is Thai Union's first step in valorizing the whole fish to its full potential.
Thai Union continued to implement actions and activities in line with its SeaChange® sustainability strategy in 3Q18 and is proud to be rated number one in the world in the food products industry in the latest 2018 Dow Jones Sustainability Index (DJSI). SeaChange® successfully drove the score with an industry best-in-class 100th percentile ranking for total sustainability score. It was the fifth consecutive year Thai Union was named to the DJSI.
"It is a privilege to be recognized for our commitment to sustainability. As one of the largest seafood companies in the world, Thai Union has fully embraced our role as a leader for positive change and positioned sustainability at the heart of our business," said Chansiri. "Further, Thai Union is the only seafood company—and only food company—to be rated number one in the world by the DJSI, performing the best out of all the companies producing food listed. Thai Union and all of its brands around the world are committed to operating in an environmentally and socially responsible manner."
At the fifth Our Ocean Conference held last month in Bali, Indonesia, Thai Union Group's, Chicken of the Sea® brand and Monterey Bay Aquarium announced the launch of SeaChange® IGNITE, a collaboration to advance new sustainability initiatives and improvements throughout the supply chain and further contribute to SeaChange®. The combined commitment for the initiative is USD $73 million through 2025, with a focus on improvements in Southeast Asia and other key seafood producing regions.
In recognition of Thai Union's efforts to address modern slavery and forced labor, the company was honored to be invited to participate in a high-level panel at the United Nations (UN) General Assembly in September to present its actions and experiences in front of the world's
Thai Union also recently participated in the second annual Bali Process Government and Business Forum held in line with the Bali Process on People Smuggling, Trafficking in Persons and Related Transnational Crime, co-chaired by Indonesia and Australia in Bali. Additionally, Thai Union stated its support for the Bali Process Acknowledge, Act and Advance (AAA) Recommendations, set as a pathway for action to achieve Target 8.7 of the UN Sustainable Development Goals (SDGs) and eliminate transnational crimes currently afflicting people throughout the Indo-Pacific region.
The company launched a short film (click here to watch) to document how Thai Union, along with support from a coalition of partners and governments, introduced digital traceability and utilized e-logbooks in supply chains to promote greater sustainability in the fishing industry. The video is the final in a three-part series which chronicles an innovative digital traceability pilot project implemented in Thailand where fishing vessels were outfitted with 'Fleet One' terminals. Crew members, captains
To coincide with World Food Day, the company also released a series of short video interviews (click here to watch) featuring participants involved in a World Food Programme (WFP) study supported by Thai Union to model the impact of a planned universal national school meals program on the economy in Kenya. Preliminary results will be announced next year and should provide valuable insights
Thai Union has received a variety of
Further, Thai Union and WWF-UK received gold in the "Best Sustainable Supply Chain" category at the Global Good Awards UK 2018—a testament to the pivotal work the two organizations have achieved through its European partnership. This was followed by Thai Union's John West brand being named
Editor Note: In September 2018, MerAlliance, a Thai Union subsidiary, announced its intention to sell or close the Edinburgh Salmon Company (ESCo), located in Dingwall, Scotland, after sustaining continuing losses averaging USD 5 million annually.
ABOUT THAI UNION GROUP
Thai Union Group PCL. is the world's seafood leader bringing high quality, healthy, tasty and innovative seafood products to customers across the world for more than 40
Today, Thai Union is regarded as the world's largest producer of shelf-stable tuna products with annual sales exceeding THB 135 billion (US$ 4.03 billion) and a global workforce of over 49,000 people who are dedicated to pioneering sustainable, innovative seafood products.
The company's global brand portfolio includes market-leading international brands such as Chicken of the Sea, John West, Petit Navire, Parmentier, Mareblu, King Oscar, and Rügen Fisch and Thai-leading brands
As a company committed to innovation and globally responsible behavior, Thai Union is proud to be a member of the United Nations Global Compact, and a founding member of the International Seafood Sustainability Foundation (ISSF). In 2015, Thai Union introduced its SeaChange® sustainability strategy.
Thai Union's on-going work on sustainability issues was recognized by its inclusion in the Dow Jones Sustainability Index Emerging Markets (DJSI) in 2014. In 2018, Thai Union was rated No. 1 in the Food Products Industry in the DJSI, while also being listed for the fifth straight year. Thai Union is also part of the FTSE4Good Emerging Index and the winner of many awards for its leading work on sustainability.
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