November 13, 2003

 

 

CP Foods See Sales To Grow 20-25% This Year

 

Thailand's biggest chicken exporter, Charoen Pokphand Foods (CP Foods), announced today that it expects sales to grow 20-25% next year from the 82.5 billion baht (US$2.07 billion) estimated for this year.

 

CP Foods' Chief executive, Adirek Sripak, said the strong growth would come mainly from the chicken firm in Turkey, which it bought from sister company C.P. Pokphand Co.

"After the purchase, our sales, which normally grow around 10-15%, will even be larger," he added.

 

C.P. Pokphand, also part of Thailand's Chareon Pokphand Group, said it planned to sell its 84.49% stake in Turkey-based CP Standart - which makes packaged chicken products - to CP Foods for US$22 million, to lower debt.

 

Adirek said the purchase of the Turkish firm, which has the largest market share there, was good for the company's exports to the European market, including Ukraine and Russia.

"The deal is definitely useful," he said.

 

The Turkish company was expected to make a profit of more than US$10 million on sales of US$130 million this year, Adirek added.

 

He added that the acquisition would help CP Foods' net profit to grow at least 10% next year. He gave no profit forecasts for this year.

 

In the first nine months of this year, CP Foods made a net profit of 1.58 billion baht after making 2.6 billion baht profit in the whole of last year.

 

Analysts polled by Reuters Research forecast a net profit of 2.7 billion baht for 2003 and 3.39 billion baht for 2004.

 

Adirek said he expected chicken prices in the firm's major markets to stay at current levels until early next year - US$1,800-2,000/ton in Japan and US$1,600-1,700/ton in Europe.

 

 (US$1 = 39.90 baht).