Thai Union posts 9.3percent growth

FOR THE first quarter of 2016, Thai Union Group PCL (TU) said its consolidated sales of THB 31, 257 million has increased 9.3 percent from THB 28,606 million from the same period last year. The company’s sales growth from recent acquisitions has contributed during a seasonally low period. With this promising start to 2016, the company is optimistic it will meet its annual target.

The quarterly gross profit margin grew significantly to 15.15 percent from 13.8 percent, while the quarterly operating profit was 54.6 percent to THB 1,454 million from THB 940 million a year ago. The higher operating margin was the result of low tuna and shrimp raw material costs and a weak Thai baht. The company said that the growth was also buoyed by robust pet care business, the strong branded ambient seafood business in Europe, and better overall margins in its US subsidiaries.

The company reported its net profit dropped 19 percent to THB 1,231 million compared to a year ago, due to  an absence of a sizeable FX gain of as much as THB 1,125 million which was reported last year, when compared with a FX gain of merely THB 264 million in this quarter. As a result, Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) also declined slightly by 6.6 percent to THB 2,755 million in 1Q16.

The company’s acquisition of German company Rügen Fisch, completed in February 2016, added to the company’s overall encouraging sales growth. Meanwhile in the Middle East, Thai Union’s emerging market strategy is beginning to bear fruit.

The company also said better operating performance this quarter, compared with a year ago and cash flow generation continued to stay very strong, while the quarterly free cash flow surged to THB 4,483 million, compared with the full year of THB 11,664 million in 2015, the company’s strongest financial year yet.