Seafood giant Thai Union Group PCL has reported a net profit of THB 1.2 billion for the first-quarter of 2024, a 53.9% increase from the adjusted net profit of Q1 2023. This excludes its share of profit and tax benefits from the Red Lobster restaurant chain.
According to Thai Union, the strong result was driven by a robust recovery in demand across the core Ambient, PetCare, and value-added categories.
Improved performances across all businesses helped lift sales by 1.7% in the first three months of the year to THB 33.2 billion from a year earlier. The gross profit margin improved to 17.3%, driven by Frozen, PetCare and value-added categories.
“Thai Union Group’s focus on our core business of Ambient, Frozen and PetCare has been instrumental in returning our business to growth,” Thai Union CEO Thiraphong Chansiri said. “Our group demonstrated great resilience during 2023 when we faced a challenging operating environment, and after seeing initial signs of a recovery in our performance in the final quarter of last year, I’m pleased to see that we have now emerged even stronger.”
In the-first quarter, Ambient sales grew 12.7% year-on-year to THB 17.2 billion, with volumes rising 12.7%, resulting in an all-time high sales contribution from the segment, driven by stronger demand across all regions, particularly in the Middle East, Europe and the US. The gross profit margin declined to 16.6% due to higher raw material prices in the group’s inventory.
PetCare sales increased 13.2% from a year earlier to THB 4 billion due to higher sales from the premium mix and price adjustment. It delivered a gross profit margin of 25.7%, the highest level since the second-quarter of 2022.
Sales in the value-added category rose by 10.8% compared to the first-quarter of 2023 due to improve product mix and booked a record-high gross profit margin of 29.5%. The Frozen category saw sales decline 17.7% year-on-year largely as a result of soft demand in the US market and the implementation of a rightsizing strategy that started in Q2 2023.
In terms of geographical diversity, sales in the US and Canada accounted for 38.6% of total revenues, followed by 29.6% from Europe, 10.9% from Thailand and 20.9% from others.
Net profit experienced a strong growth, compared to adjusted net profit of Q1 2023. This was driven by improvements across all business categories, despite reduced foreign exchange gains, lower share of profit, higher financial costs and increased tax expenses.
Also in the first-quarter, Thai Union announced a Zero Wastewater Discharge Project at its fish plant in Thailand to set a new global benchmark for a seafood factory by achieving 100% wastewater recycling. The group also launched the Shrimp Decarbonisation initiative, developed in collaboration with global environmental organisation The Nature Conservancy (TNC) and Ahold Delhaize USA, to reduce greenhouse gas (GHG) emissions within the shrimp supply chain, while Thai Union Feedmill became the first feed mill in Asia to receive the Aquaculture Stewardship Council (ASC) Feed Standard certificate.
“I am confident that through our Strategy 2030, which will create a sustainable and healthier future for humans, pets and the planet, and which is underpinned by a purpose of ‘Healthy Living, Healthy Oceans’, that Thai Union Group is well positioned for sustained, long-term growth,” Chansiri said.
