Thai Union Sees Sales, Profit Decline In Second Quarter
Thai Union, a prominent seafood company, has announced a second-quarter net profit of THB 1.0 billion (€26 million), reflecting a 36.7% decline compared to the previous year. This decrease is attributed to foreign exchange losses and the impact of i-Tail’s net profit dilution.
Revenue for the quarter experienced a year-on-year drop of 12.6% to THB 34.1 billion (€890 million). This decline is attributed to a high baseline set the previous year, elevated customer inventory levels, logistics normalization, and a generally subdued demand.
Nevertheless, Thai Union’s gross profit margin remained steady at 16.9% despite elevated raw material prices. Notably, the maker of John West observed an 8.2% year-on-year increase in operating profit for the quarter, reaching THB 1.8 billion (€47 million).
Thai Union’s CEO, Thiraphong Chansiri, acknowledged the challenges faced in the first half of 2023, while noting promising indications of market recovery in the latter part of the year.
He highlighted the company’s strong balance sheet, with a net debt to equity ratio well below their target, and a healthy dividend payout rate of 70.3%.
In terms of quarter-on-quarter performance, sales saw a 4.3% increase to THB 34.1 billion (€890 million), and net profit rose by 0.7% from the previous quarter’s low point.
Thai Union declared an interim dividend of THB 0.30 per share, scheduled for payment to shareholders on September 4, 2023.
The company’s ambient seafood segment experienced growth in the second quarter, with sales rising by 1.3% year on year to THB 17.1 billion (€450 million).
This growth was attributed to higher selling prices and promotional efforts, particularly in the EU market. Thai Union continued to focus on introducing new and innovative products that emphasize variety, diversity, health, and wellness across its branded portfolio.
Additionally, its Red Lobster business demonstrated improved performance during the second quarter due to the positive impact of its ongoing turnaround strategies.
Looking forward to the rest of 2023, Chansiri outlined Thai Union’s commitment to bolstering global profit protection measures, targeting cost savings and enhanced operational efficiency.
The company remains optimistic about its long-term prospects and is dedicated to maintaining its role as a sustainability leader in the seafood industry.
This commitment is underscored by the recent launch of SeaChange 2030, a sustainability strategy that involves a dedicated fund of $200 million (€181.4 million) until 2030, with a focus on transforming the seafood industry while prioritizing people and the planet.
