February 26, 2019
Lay Hong 3Q profit plunges 63% on lower sales
Malaysian poultry and egg producer Lay Hong Bhd's third quarter net profit plunged 63% to RM3.75 million (US$0.92 million), from RM10.11 million a year ago, due to lower sales and the closure of a retail outlet, The Edge reported.
Revenue for 3Q ended December 31, 2018 stood at RM203.32 million, down 10.9% from RM228.19 million previously. Lay Hong attributed the decrease in revenue in its integrated livestock business to a lower quantity of processed chicken products sold. Lower revenue was also recorded at the group's retail supermarket segment, due to the closure of one of the retail outlets in Papar, Sabah.
For the next few months, Lay Hong expects average egg price to remain at the current level.
"The joint venture company with NH Foods Ltd has commenced production and is progressively ramping up production to its planned level within the next few quarters.
Of late, the US dollars against the ringgit has shown sign of easing and this scenario will augur well for the group's major raw materials of corn and soya bean usage," the group said.
However, Lay Hong said the full commissioning of its liquid egg plant in Johor has been delayed slightly due to "unavoidable technical issues". Lay Hong first announced investing in the facility about a year ago which will cost RM16.59 million.