TUF Q2/2015: Performance Back On Track With Improving Financials And Interim Dividend of THB 0.32 Per Share

• Quarterly consolidated sales grew 1.3% YoY and 7.1% QoQ to THB 30,642 million, thanks to contributions of recent acquisitions (MerAlliance, King Oscar and Orion Seafood)
• 2Q15 Gross Margin increased by 22.5% QoQ to 16.9% from 13.8%
• 1H15 Net Profit reached THB 2,919 million, up 18.1% from the same period last year
• The interim dividend for the first half-year performance is THB 0.32 per share

Bangkok - (August 13, 2015) - Thai Union Frozen Products PCL. (TUF) reported a strong resilient operating result for the second quarter of 2015 as sales reached THB 30,642 million with improved gross profit and operating margin. In addition to continual contribution from recent acquisition, MerAlliance, King Oscar and Orion Seafood, gross and operating margins have recovered strongly despite challenging market conditions and deep depreciation of the Euro from a year ago.

The company’s gross margin for the second quarter managed to attain a respectable level of 16.9%, compared with 13.8% in the first quarter and 16.1% for the same period last year. Continual strong margins from own brands and a slight recovery of EUR against Thai baht are the culprits of this recovery.

During the first six months, cumulative net profit reached THB 2,919 million, up 18.1% from the same period last year with net profit margin at 4.9%, compared with 4.2% a year ago. This figure is much in line with the company’s annual target.

After a turbulent 1Q15 due to currency rate fluctuations, the company’s operating performance is now back on track on its margin and sales targets. More importantly, its financial leverage, in terms of net debt-to-equity ratio, continued to drop to a new low level (0.68x) in recent years, indicating a strong financial position for future growth opportunities.

As of 1H15, the company’s sales generally came from USA (42%), Europe (31%), Domestic (8%), Japan (6%) and other countries (13%), of which tuna (40%), shrimp and related business (27%), salmon (8%), pet food (7%), sardine / mackerel (6%), and value-added and other products (12%). In general, these breakdowns are fairly stable this year. However, the proportion of sales from own brands increased to 43% (vs. 41.3% a year ago) with OEM sales accounting for the balance.

Mr. Thiraphong Chansiri, President and CEO of Thai Union Frozen Products PCL (TUF) said, “In spite of the challenges of currency fluctuations and certain one-time expenses, the operating performance of the company had been satisfactory.”

“Moreover, the merit of investing in first class European companies as part of our overall global strategy has been clearly demonstrated in the past few quarters by their strong operating performances. These companies show strong resilience and thrive in tough market conditions.” Mr. Chansiri added.

“As we continue to move forward, we will remain focused on achieving organic growth through our core product categories and improved efficiency in our operations across the globe. Our international footprint will continue to expand and we remain committed to achieving our revenue target of USD 5 billion this year”.

The company also announced the first interim dividend for the first half-year performance of THB 0.32 per share, of which THB 0.04 per share will not be subject to income tax. The XD is set for August 25.