May 15, 2012

Thai Union Group revealed first-quarter results, for 2012, at a net profit of THB1,467 million (US$46.8 million) equivalent to a 95% on-year growth.

Despite the fire incident at one of its shrimp processing plants early in the year, the Company managed to deliver robust quarterly performance, reflecting its strengths and solid business position of global brand leadership in the seafood industry.

Thiraphong Chansiri, president of Thai Union Frozen Products PCL. (TUF), revealed that, for the first quarter of 2012, the Company enjoyed a robust growth in net profit by as much as 95%, compared to 2011. Earnings per share for the quarter were THB1.53 (US$0.05), up 94% from the corresponding period last year. Quarterly sales in US dollar term were US$822 million, up 11% from a year ago. In line with sales in US currency, sales in Thai baht term also grew equally by 11% from 2011 to a value of THB25,304 million (US$807.3 million) in the first quarter. Total revenues for the quarter amounted to THB25,678 million (US$819.2 million) , up 12% from the first quarter of 2011.

According to further explanation given by Khun Thiraphong, the overall performance for the quarter was close to sales growth target. Normally, the first quarter is typically the slowest quarter of the year. This year, however, the company could generate excellent sales and net profit during the first quarter, almost the same as those figures reported in last year's strongest quarter.

Strong sales growth was seen across all product lines during the quarter while the gross profit margin rose to 17.2%, which was higher than 14.8% achieved in the first quarter a year ago. During the quarter, a fire incident took place at one of its Thai shrimp-processing plants in Samut Sakhon province. The firm consequently relocated its shrimp plant workers to its other shrimp-processing facility in Songkhla province. The fire did negatively affect the firm's first-quarter performance to some extent, but not considerably. In consideration of the overall performance for the quarter, the Company is confident that further profitable growth is well on track. The Company remains ready for achieving its US$5,000 million annual sales target within 2015.

With regards to the fire incident, shrimp production has now been resumed to a normal level. The company only suffered an insignificant financial impact as the damaged plant facilities and goods are fully covered by its insurance policy. The insurance policy also provides full compensation to the Company for any potential business interruption.

For this quarter, tuna products make up the largest share in the company's product portfolio at 50%, followed by frozen shrimp (16%), canned pet food (7%), products for domestic market (8%), canned seafood (5%), frozen salmon (5 %), shrimp feeds (4%), canned sardines and mackerel (5%) and frozen cephalopod (1%). Main export markets include the US (36%), European Union (30%), Japan (9%), domestic market accounts (10%), Africa (4%), Oceania (4%), the Middle East (3%), other Asia (3%), Canada (1%) and South America (1%) of total sales.

In 2012, the company will implement more aggressive marketing strategies for its domestic market. Branding initiatives will cover both corporate brand and product brand to enhance stronger recognition among Thai consumers. In the past, the company's strategies did not focus strongly on the domestic market because over 90% of its revenues were typically generated from overseas markets. However, branding will become an important business initiative for the company from now on.

To begin with, the company's logo has been changed to convey an more international image to the public. The first commercial advertisement, depicting the fact that the firm is the true owner of a host of well-recognised global tuna brands, has been produced and aired on local TV channels in order to make TUF a more familiar name to Thai consumers. In addition, more public relations and advertising activities will be implemented all year round via mass media.