SFI – BT

SFI posts 29.7% rise in Q1 net to $12.87m

This is despite firm’s revenue rising just 2.2%; turnover from S’pore ops up 13.1%

SINGAPORE Food Industries (SFI) yesterday reported a 29.7 per cent year-on-year rise in first-quarter net profit to $12.87 million, despite revenue rising just 2.2 per cent.

Turnover for the three months ended March 31 was $176.37 million, while earnings per share were 2.5 cents, up from 1.9 cents a year earlier.

Turnover from Singapore operations rose 13.1 per cent to $65.1 million, while profit before tax rose 14.4 per cent to $7.5 million. Sales from food distribution here came in at $35.5 million – up from $32 million. But higher costs, especially for external storage and transport, led to a lower profit before tax from the segment.

Food catering sales rose because of higher consumption at higher prices, while revenue from abattoir operations and hog auctions increased on higher pig numbers and higher slaughter fees. In contrast, revenue from UK and European operations dropped 4.6 per cent to $101 million and profit before tax dipped 13.5 per cent to $7.2 million, mainly due to the stronger Singapore dollar against the British pound.

Denominated in pounds, sales from UK and European operations rose 3.4 per cent, but profit dipped 2.8 per cent.

SFI chief executive Roger Yeo said: ‘Both Singapore and UK operations delivered improvements in their underlying business performance. However, the strong Singapore dollar had an adverse impact when translating the pound sterling results of our UK operations into Sing dollars.’

SFI is upbeat about its prospects here, saying the ‘renewal of our key catering contract in Singapore is a positive development’.

‘The catering business will face cost pressure on raw materials and labour, but this is somewhat mitigated by a price-adjustment mechanism under the contract with our key customer,’ it added.

UK operations are also expected to do well in local currency (pound) terms, and SFI has forecast higher earnings this year.

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