February 6, 2004

Thai Seafood Industry Set To Gain From Bird Flu

Thai canned seafood producers may gain substantially from the bird flu outbreak sweeping through the country.

"Though certain industries have felt the pinch of the bird flu outbreak in the first quarter of this year, the country's finished seafood business remains in very good shape and on an upswing in line with the industry's growth," said Salil Tohtubtiang, chief executive officer of Kuang Pei San Food Products Plc, the maker of Pompui Smiling Fish canned seafood.

"The outbreak [of bird flu] offers a good opportunity for consumers to try more seafood," he said.

January sales for the Trang-based company, best known for its canned sardines, rose by 20% compared with previous growth of just 8%.

But Mr Salil insisted the outbreak had not played a major role in the rise.

He said more significant factors included the government's policy of promoting the Thai food industry and the growing desire among Thai people for products with high food safety standards. Mainly driven by the country's economic recovery and robust exports, the company last year reported better-than-expected revenue of 700 million baht, a 10% increase from a year earlier.

The revenue growth was attributed mainly to significant growth in exports which jumped 15% last year against 8% growth in domestic sales.

Currently, domestic markets account for 70% of the company's revenue, with 30% from exports.

The company projected sales would grow by up to 20% this year, regardless of the bird flu outbreak. Exports in particular were expected to grow by up to 25% this year, with domestic sales expected to grow around 10-12%.

"The Smiling Fish brand is widely recognised in certain export markets including the United States, the European Union and Asia," said Mr Salil. "We are now expanding into new markets in China, India and Africa."

On the domestic front, Mr Salil said the company planned this year to focus on strengthening Smiling Fish brand awareness particularly through a new line of products, advertising and its "Smiling Tower" promotion.

The company plans to install 1,500 Smiling Towers - free-standing canned seafood displays - at retail outlets across the country this year, up from 1,000 last year.

Kuang Pei San claims a 12% market share in domestic sales of high-quality sardines in tomato sauce, a market said to be worth 600 million baht a year.

The company's shares, which trade under the symbol POMPUI, closed yesterday at 12.80 baht, down 80 satang, in thin trade worth 26,000 baht.