Japfa net profits up 36.9% amidst pandemic, swine flu

Japfa's net profits were up 36.9% to US$35.5m.

Regional agri-food company Japfa recorded a 36.9% increase in its first quarter net profit, at US$35.5m with strong results from all segments.

This is despite the ongoing COVID-19 pandemic, and African Swine Fever affecting some of its markets.

PT Japfa Tbk, its Indonesia-based poultry arm, has also been affected by movement restrictions due to COVID-19. Still, revenue increased by 15.2%, as the government's culling intiatives balanced poultry demand and supply.

Its swine operations in Vietnam continued to deliver strong results, with a 24.7% increase in revenue, due to higher swine fattening sales volumes. The company, through strict biosecurity protocols, was eble to contain the adverse effects of African Swine Fever and replenish its stock faster than most of its competitors.

Its feeds segment in Mayanmar saw an operating loss due to recent political disruptions in the nation, while its feeds segment in India broke even despite the surging pandemic.

Dairy saw a 6.9% increase in revenue due to higher sales volumes in both the dairy and beef business.

During the quarter, PT Japfa Tbk placed a US$350m senior fixed rate sustainability linked bond (SLB) with a 5.375% coupon maturing in 2026. This was over 3 times oversubscribed.

"In 1Q2021, we have also achieved an important milestone with the successful issue of the first-ever sustainability-linked bond in the agri-food industry in the world. We are pleased with the positive response that our SLB received from the markets. The SLB is an additional catalyst to achieve our sustainability targets and an opportunity for our investors to partner with us towards a sustainable future," said Japfa CEO Tan Yong Nang in a Singapore Exchange disclosure.