August 11, 2003
Spectacular Rebound In CP Foods' Net Profit For Second Quarter
Charoen Pokphand Foods Friday reported a sharp swing to net profit of THB900.2 million for the second quarter to June 30, as expected, from a first quarter net loss of THB826.2 million.
The recovery was due to an agreement by chicken producers to limit supplies in the local market after a collapse in prices during the first quarter, analysts said.
Local supply became excessive in the first quarter when exports dried up after the European Union imposed a requirement that 100% of imports from Thailand be tested for banned substances. In late June, the rule was relaxed to random testing of 20% of shipments, but Thai suppliers recently agreed to continue limiting local supply for another 10 weeks.
For the second quarter last year, CP Foods reported net profit of THB892.6 million.
CP Foods said in a filing to the Stock Exchange of Thailand that its earnings per share in the second quarter fell on year to THB0.17 from THB0.25, despite the increase in profit, as the number of its outstanding shares rose.
Net sales in the period increased 10% on year to THB20.46 billion, as both domestic and export prices rose on supply limitations.
Analysts said orders from abroad were diverted to Thailand during the severe acute respiratory syndrome outbreak, when overseas customers stopped doing business with China as part of efforts to contain the SARS epidemic.
The company said in a separate filing that its board of directors has approved payment of an interim dividend of THB0.05 a share to shareholders registered as of noon on Aug. 22. The dividend will be paid from the profit of non-tax-exempted business on Sept. 5.
CP Foods' first-quarter loss cut net profit in the six months to June 30 to THB74.03 million, from THB1.65 billion in the year-ago first half.