F&N's 1H 2009 Pre-tax Higher By 13.9pct

KUALA LUMPUR, May 5 -- Fraser & Neave Holdings Bhd (F&N) posted a 13.9 percent higher pre-tax profit of RM150.5 million for the first half year ended March 31, 2009 from the RM132.2 million recorded in the same period of 2008.

Its revenue for the first half period held steady with a 1.3 percent growth to RM1.831 billion from RM1.807 billion.

"We had a good first half year and all core businesses showed resilience in spite of the slowing economy," said its chief executive officer, Tan Ang Meng, at a briefing on the half-year results here, Tuesday.

F&N is involved in the food and beverages (F&B) business, offering soft drinks, dairies and glass packaging. Property is its non-F&B division.

Tan said the soft drinks division registered volume growth during the Chinese New Year period through effective and impactful marketing activities.

He said revenue for the first half grew in tandem with volume growth of five percent to reach RM663 million.

However, he said the higher group revenue was being partially offset by lower exports of dairy products.

According to Tan, the dairies operation benefited from lower cost in the second quarter but revenue declined by three percent due to lower exports.

Nevertheless, domestic sales in both Malaysia and Thailand for dairy products was stable, he said.

Tan noted that F&N's new dairy plant at Rojana, Thailand, is at an advanced stage of construction and would be operational by the middle of 2009.

On the glass division, Tan said volume had been affected by a lower purchase from its F&B customers but revenue was up nine percent due to a better sales mix and higher selling prices.

On the prospects for the second half of the financial year, Tan cited the lower commodity prices and government stimulus packages to boost spending, as positive factors.

"Consumer spending and sentiment is expected to remain weak for the remaining months of this financial year as economic conditions deteriorate," he said.

He indicated though that the sales revenue of the group is expected to be stable as F&N products are daily necessities and priced at affordable levels.

"Given the first half performance, the group expects a satisfactory outcome for the year," Tan said.

With better results, F&N will maintain an interim dividend payment of 17 sen -- the same as last year.

A net dividend of 12.75 sen per share or RM45.4 million would be paid on Aug 6.

-- BERNAMA