F&N 2012 earnings climbed 14% to $161m

It has been a long tough ride.

According to a release, Fraser and Neave achieved revenue of $913 million in the first quarter ended 31 December 2012 (“1Q2013”), an increase of 17 per cent over the same period last year. 

On the back of strong revenue growth, profit before interest and taxation (“PBIT”) improved 14 per cent to $161 million.

This quarter, the Group saw the completion of the disposal of its entire interest in Asia Pacific Breweries Limited (“APB”) for $5.6 billion. Following the completion in November 2012, the Group realised a disposal gain of $4.8 billion, pushing 1Q2013 profit after taxation (“PAT”) to $4.9 billion.

Subsequent to the divestment of F&N’s entire interest in APB, Soft Drinks is grouped with the remaining beer business to form the Beverages division. After a year of separation from The Coca Cola Company’s franchise, the Group saw its Soft Drinks division in Malaysia grow volume ahead of the market across key categories.

This division continued to register volume growth despite intense competition. Similarly, the Group’s 55-per cent held brewery in Myanmar Brewery Limited (“MBL”) also delivered strong results for the quarter, continuing the good momentum from FY2012.

MBL registered volume growth and maintained strong market leadership position in Myanmar with its leading beer brands like Myanmar Beer, Myanmar Double Strong and Andaman Gold. Together, this newly-formed Beverages division recorded a 10 per cent profit growth, to $34 million.

An efficient new plant in Pulau Indah, higher export volume and lower input cost boosted Dairies Malaysia volume and earnings growth. In Thailand, Dairies was supported by strong domestic and export sales, after the plant was shut down for about seven months due to floods in the 1H2012.

Consequently, Dairies Thailand returned to profitability, compared with a loss in the same period last year. Overall Dairies division posted a profit of $15 million, versus $2 million in the same period last year.

Earnings from Properties continued to be supported by pre-sold development projects as well as improved performance from Commercial Property.

On the back of a 38-per cent improvement in Development Property’s revenue, PBIT grew 20 per cent to $58 million, mainly from projects currently under development in Singapore namely Boathouse Residences, Eight Courtyards, Flamingo Valley, Seastrand, Waterfront Gold, Waterfront Isle and Watertown.

Commercial Property, which comprises Investment Property, REITs and Hospitality, recorded healthy earnings growth, despite the absence of rental income from two investment properties following the divestment of a listed subsidiary, Frasers Property China Limited, in September 2012.

REITs and Hospitality each delivered strong performance with profit up by 36 per cent and 29 per cent, respectively. Overall, Commercial Property profit grew 6 per cent to $42 million this quarter.

As at 5 February 2013, TCC Assets Limited and parties acting in concert (“TCC Group”) with, owned, controlled or agreed to be acquired, including valid acceptances to the F&N Offer, approximately 75.7 per cent of the issued share capital of F&N, making TCC Group the major shareholder of F&N. This marks a new era for the F&N Group in its 130th year of operation.