Dairy Farm's profits up 12% to US$501m

Here's what boosted this growth.

According to a release, Dairy Farm's profits attributable to shareholders in 2013 of f US$501 million was up 12%.

“Trading conditions are expected to remain challenging in some key markets, particularly in the Food sector in Southeast Asia.

Nevertheless, progress is being made in addressing margin pressures, enhancing brand focus, strengthening supply chain and systems capability and building the right organization to support future growth. With a leading market position in most major businesses and its strong financial position, Dairy Farm is well placed to grow.”

Sales, including 100% of associates and joint ventures, rose 8% to US$12.4 billion in 2013 with growth across all divisions. Underlying profit was US$480 million, an increase of 8% over the US$444 million recorded in 2012. Underlying earnings per share were US¢35.52, up 8% from US¢32.86.

If the write-off of the prior years’ Malaysian supplier income is excluded from the 2012 results, however, underlying profit in 2013 was 4% lower. This is largely a reflection of the mixed performances within the Food businesses.

Increased profitability in Hong Kong and mainland China was more than offset by reductions in Indonesia, Singapore and Malaysia as a result of more competition, higher operating costs, a weaker economic environment and adverse currency movements.

In contrast to the Food business, there were record sales and profits in the three other divisions, Health & Beauty, Home Furnishings and Restaurants.