Thai Union reports profits up 13%
Thai Union has reported a 13.1% increase in gross profit in the second quarter of the year, with stronger performances from the frozen seafood and PetCare and value-added product businesses.
Consolidated sales during the quarter declined 4.6% year-on-year to THB 32.2 billion due to the Thai baht’s appreciation, the depreciation of EU currencies and lower raw material prices. However, organic sales volumes continued to grow, particularly in the frozen seafood and PetCare businesses supported by Thai Union’s strategy to pursue more value-added products.
In the first half of 2019, North America contributed 39% to total sales, followed by Europe at 29%, the Thai domestic market at 12%, and other markets at 19%.
Thai Union's ambient seafood sales in 2Q19 were down 14.3% year-on-year, while gross profit was up 9.1% year-on-year. The sales contribution from the frozen and chilled seafood business increased 3.6% year-on-year, driven mainly by volume growth of 10% from the same period last year. PetCare and value-added product sales increased 6.7% from the second quarter of 2018, with significant sales volume growth of 5.9%.
“Profitability remains a key focus for us at Thai Union, and the overall performance in the second quarter was pleasing, particularly in a challenging operating environment,” said Thiraphong Chansiri, CEO of Thai Union. “As we look ahead, Thai Union will continue to see new innovative products developed and launched into market, which will provide us with new revenue streams as we work to build a business with sustainable growth.”
During 2Q19, Thai Union subsidiary Chicken of the Sea reached a settlement with a majority of plaintiffs in an ongoing antitrust litigation in the US, resulting in an additional THB 1,402 million after tax. Excluding the one-time accrual, the company recorded a net profit of THB 1,513 million.
“We share this updated litigation status as Chicken of the Sea has now appropriately provided for any financial impact,” said Group Chief Financial Officer Joerg Ayrle.
Thai Union continues to invest in innovation, and in June its new Global Innovation Center in Bangkok was officially opened by Her Royal Highness Princess Maha Chakri Sirindhorn. The facility has been expanded to over 5000 square meters, and accommodates more than 160 scientists and researchers from around the world.
Thai Union also released its Sustainability Report during the quarter, detailing the positive progress the company made in 2018 and its performance against key performance indicators and targets outlined in its SeaChange® strategy.
Thai Union’s sixth sustainability report demonstrates how the company’s commitments and measures are helping the company drive meaningful improvements across the entire industry.
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