KUALA LUMPUR: Farm Fresh Bhd's thid quarter ended Dec 31, 2023 net profit rose 8.9 per cent to RM20.44 million, from a reduction in input costs from dairy raw materials, an increase in prices for chilled ready-to-drink (RTD) products, and contributions from Inside Scoop and Sin Wah.
RTD prices increased in Malaysia effective mid-July 2023.
The company reporteds a net profit of RM18.77 million a year ago.
Quarterly revenue grew 30.5 per cent to RM211.62 million from RM162.17 million previously.
Farm Fresh said the jump in revenue came from the hotel, restaurant and cafe (HORECA) distribution channel, higher sales volume coming from UHT products as well as contributions from Inside Scoop Sdn Bhd and Sin Wah Ice Cream Sdn Bhd.
The group registered an earnings per share of 1.09 sen compared to 1.01 sen in 3Q23.
For the nine-month period ending March 31, 2024, Farm Fresh's net profit declined to RM39.6 million from RM45.2 million a year ago, while revenue increased to RM595.38 million from RM468.33 million.
Farm Fresh said the nine-month results were dampened by the 1Q24 results, which was badly affected from the high dairy raw materials cost and has since seen improvements beginning from 2Q24 due to lowering of costs and impact of price increase.
Group managing director and group chief executive officer Loi Tuan Ee said Beyond numerical milestones, its focus remains on delivering sustainable business growth, especially with the introduction of Farm Fresh Grow powder format. He added that the group also looks forward to launching its consumer packaged goods (CPG) ice cream with a planned launch by June 2024.
"We plan to install our new production line which is set to arrive in April at our Taiping plant and will commence production while waiting for the completion of our Enstek plant in 2025. "Moreover, the recent acquisition of Sin Wah provides immediate access to strategic distribution drop points and logistical capabilities, which will further fortifying our ice cream distribution network," he said. Furthermore, Loi said the company is also starting its butter production at its Taiping plant, targeting both HORECA and modern trade segments, alongside cultured milk which is to be produced at its Larkin plant.
On regional growth, he noted that the group is focused on having its Philippines plant operational by May 2024, pending the completion of necessary licences and registrations.
"Our initial plans will be centred around assortment of chilled products, UHT products, and growing-up milk powder for the Philippines market, with a primary focus on the Greater Manila area. "All these considered, Farm Fresh's future prospects remain intact, and we maintain a positive outlook on the group's growth trajectory," he said.