TUF Announces Record Q3 Sales and Profits

Thai Union Frozen Products PCL. (TUF) recently announced its Q3/2012 operating results that set new highs in both profit and sales. Net profit amounted to Baht 1,613 million while sales reported a total of Baht 28,327 million (US$907 million). The results reflected the continuing overall growth of the company despite high raw material price increases in tuna and shrimp. TUF is confident that growth in 2012 will not be less than 12%.

TUF president Thiraphong Chansiri, said that the company’s net Q3 profit of Baht 1,613 million is an increase of 4.6% compared with the Baht 1,542 million of Q3 2011. Earnings per share were Baht 1.41. Sales volume also increased in baht term by 12.8%, from Baht 25,105 million in Q3 2011 to Baht 28,327 million in this year’s third quarter. In US dollars sales were US$907 million, up 9.1% compared to the US$831 million in the same quarter of last year.

TUF company posted a total net profit of Baht 4,081 million, an increase of 13.8% compared with Baht 3,586 million for the same nine month period of 2011. In US dollar term, sales during the nine months were seen at US$2,581 million, an increase of 7.7%. Sales in baht term were Baht 80,389 million, up 10.6% compared to the same period of last year.

The results suggest continuing record highs in both profit and sales for TUF. Results also reflect strong business operations and steady growth of each business unit, especailly tuna and sardine/mackerel products, which grew by 22% and 54% in terms of Thai baht sales, respectively. The company managed to reduce its interest expenses. Proceeds from raising the company’s share capital were spent in late Q2 on repaying a loan, lessening the interest burden in this quarter. The total net profit was therefore up significantly at 61% when compared with the second quarter 2012 of Baht 1,001 million. The gross profit margin of 15.7% in this quarter, compared with 17.2% a year ago, was attributed to rising production costs since early 2012.

Raw material prices have also increased. The average price for tuna over the first nine months was US$2,168 per ton, an increase of some 26% compared with that of last year. Shrimp prices have been volatile. Supplies of shrimp have partly been affected by EMS (Early Mortality Syndrome). Although the company faced several challenging factors, it still managed business well, which resulted in a satisfactory performance.

The company’s revenues breakdown by 6 main strategic product groups during the nine-month period were tuna business (50%), shrimp and relating business (22%), sardine and mackerel business (6%), salmon business (4%), pet food business (7%), value-added product business and other products (11%). The company’s revenues by markets include the US (35%), European Union (31%), domestic market accounts (10%), Japan (9%), Africa (5%), Oceania (3%), the Middle East (3%), Asia (2%), Canada (1%) and South America (1%).

The TUF president Thiraphong Chansiri added, “The increase in our shareholding in Avanti Feeds Limited (AFL) of India (a listed company on the National Stock Exchange of India) from 14.99% to 25.12% was a result of a swap of shares of Avanti Thai Aqua Feeds (ATA) that were preceding owned by TUF. As a result, Avanti Feeds is now the sole shareholder, owning 100% of ATA. The adjustment will allow us to improve the business’ operational efficiency. Currently, the shrimp businesses in India, especially shrimp feed, has grown more than three times during the past three years and suggests a promising future for the business.

Finally, with regards to our overall business operations, I believe that the company will grow by at least 12% this year,” the TUF president concluded.