CPF 2010 net profit soared by 33% to THB 13,563 million beat its target
Charoen Pokphand Foods Public Company Limited reported 2010 net profit of Baht 13,563 million or earnings of Baht 2.04 per share, an increase of 33% from 2009 net profit, reports www.megafishnet.com with reference to CPF.
The Company also announced the annual dividend payment for the year 2010 at Baht 0.55 per share determined from the operating results of the second half of the year. The annual dividend when combined with the interim dividend paid on September 10, 2010 at Baht 0.50 per share will totally be Baht 1.05 per share for the whole year operating results. The Company still aims to expand its animal feed and farming businesses in overseas as well as focus on its ready-to-eat branded products both domestically and internationally.
Total revenues for 2010 of Baht 189,049 million increased 15% from 2009. The 2010 revenue growth mainly contributed from the growth of the overseas operations of 55% compared to the growth of Thailand operations of 5% making the revenue contribution from the overseas operation increased to 26% from 19% in 2009.
Mr. Adirek Sripratak, President and Chief Executive Officer, said that this year's operating strategy is to focus on accelerating the expansion in the existing overseas businesses as well as investing in new overseas countries. The Board of Directors of CPF recently approved the plan to invest in Cambodia, and this transaction is expected to be completed within the first quarter of 2011. Including this investment, CPF has currently managed a total of 11 overseas countries. Moreover, the Company also has a continuous plan to further expand its businesses in other overseas countries. With this plan the Company expects that the overseas operations' revenue contribution will increase from 26% in 2010 to 40% in the next 5 years.
Although the Company expected that the overall consumption in Thailand and in the world will not rise significantly in this year, the Company is still focusing on distributing its ready to eat food products under CP brand domestically and internationally as well as diversifying its retail distribution channels via CP Fresh Mart and the 5 Stars Chain. With these 2 strategies, the Company believes that it can successfully achieve its food businesses' growth target of 15% from 2010.
In addition, the Company is very confident in its integrated shrimp businesses as one of its major business lines with a continuous exceptional performance. After the Company has developed and exported its cooked shrimp products, the products have been gaining recognition as reliable and quality products, and are accepted by the exporting countries. With the development of the aquaculture industry in Thailand, Thailand's competitiveness in the world market as a low cost producer has rose, and the shrimp prices have gradually been reduced to the level that is acceptable by the consumers. As a result, CPF has further expanded its shrimp businesses to other countries with a high potential such as India, Malaysia and Philippines. As such, the Company expected that the growth for the shrimp businesses will be at least 20%.
A dramatic increase in commodity prices worldwide has led to the food inflation. There are several factors contributing to the rise in food prices including lower than expected agricultural productivity caused by climate changes, insufficient investment in improving agricultural production efficiency, and higher consumptions due to population growth, rising affluence and higher spending power. These factors, coupled with falling in world-food stockpiles and higher commodity prices including agricultural and meat products will worsen the world food crisis. Foreseeing this trend, CPF is committed more than ever to continuously improve the efficiency to lower its production cost and increase its competitive advantage in the world market as well as expand its production bases into the countries where there are high demand for meat consumption.
Mr. Adirek said, for this year, the Company is aiming to achieve a 10-15% growth in revenues from 2010 where the majority of growth will come from the overseas operations. Although the production cost expected to be at a higher level than the previous year, the company foresees profit growth opportunities by focusing on human resource development, financial and investment management, and ongoing concerted efforts in containing its costs with a view to continuingly improve its efficiency and productivity.