SINGAPORE (Nov 9): Food Empire announced that 3Q17 earnings increased 26.8% to US$7.4 million ($10 million) compared to US$5.8 million in 3Q16.
Revenue for the quarter increased 2.7% to US$70.1 million from US$68.3 million a year ago.
Sales in the group’s Kazakhstan and CIS markets decreased by 29.2% to US$6.72 million, as compared to 3Q16, mainly due to a one-off reclassification of its advertising and promotion expenses.
Sales in the group’s other markets increased by 34.0% to US$15.9 million, mainly due to higher sales contribution from its non-dairy creamer plant and snacks manufacturing facility in Malaysia, as well as instant coffee plant in India.
Similarly, cost of sales was up by 3.8% to US$43.7 million compared to US$42.1 million last year.
Hence, gross profit for the third quarter ended September came in at US$26.4 million, 0.8% higher than US$ 26.1 million recorded in the same period last year.
Selling and distribution expenses decreased 16.5% to US$8.76 million from US$10.5 million in the previous year, mainly attributed to a one-off reclassification of its advertising and promotion expenses offset by higher manpower cost.
However, general and administrative expenses increased by 8.3% to US$8.35 million from US$7.71 million last year, mainly attributed to higher manpower cost and transportation expenses.
On the outlook, the group continues to focus on expanding into new geographies outside its core markets to provide a more balanced portfolio.
It is on the lookout for opportunities to expand its ingredients business further and expects it to be a key growth driver going forward.
Besides organic growth, the group intends to tap on strategic mergers and acquisitions to expand further upstream and downstream as well as enter new markets.
Shares in Food Empire closed 1 cent lower at 66 cents on Thursday.
