F&N first-half profit up 0.3% on higher sales of beer, soft drinks and milk

SINGAPORE – Beverage company Fraser and Neave (F&N) saw profit grow 0.3 per cent for the first half of its fiscal year ended March 31, on the back of stronger sales of its beer, soft drinks and milk.

The group declared an interim dividend of 1.5 cents per share, unchanged from a year ago. This will be paid on June 6.

“F&N has delivered a resilient performance despite the challenging market environment,” said Mr Hui Choon Kit, its chief executive.

“Strong sales, a favourable cost environment and positive forex movements in our F&B (food and beverage) division reflect our ability to navigate external challenges and capitalise on the strengths of our core business.”

Asked whether the group was impacted by US tariffs, Mr Hui said: “F&N has minimal business exposure in the US and is therefore not directly affected by the recent tariffs.

“Although we have seen some shipping disruptions, our supply chain continues to function effectively and there are currently no price changes related to the tariffs,” he added.

He said the group is closely monitoring broader market conditions, particularly consumer sentiment, which may be affected by global economic developments.

“We remain ready to take necessary measures to ensure supply stability and cost efficiency,” he said.

For the first half-year, revenue rose 13 per cent to $1.21 billion, from $1.07 billion previously.

By segment, the increase in group revenue was supported by the strong performance of the F&B division, which posted a 15 per cent rise in revenue.

In particular, the beer and soft drinks segment saw a 28 per cent rise in revenue, driven by higher sales volumes from Chinese New Year campaigns, the introduction of new products and better pricing, F&N said.

The dairies segment, which is the largest contributor to group earnings, recorded an 8 per cent increase in revenue.

This was supported by strong domestic canned milk sales in key markets, along with increased volumes in Laos and Cambodia.

It also saw the first contributions from the Malaysia School Milk Programme. 

But the publishing and printing segment’s revenue declined by 1 per cent.

Mr Hui said: “While global uncertainties persist, including geopolitical tensions and trade challenges, we continue to take measured steps to address these complexities.”

He added: “Our disciplined approach to risk management and our focus on operational resilience position us well for long-term growth.”

A key recent move was the arrival of 2,500 dairy cattle at F&N AgriValley in April, the group’s integrated dairy farm. 

“This milestone supports our ambition to build a sustainable, vertically integrated fresh milk supply chain in South-east Asia,” he added.

F&N has invested about $510 million in smart farming and sustainable agriculture, which will help to reinforce its growth strategy and commitment to regional food security, he said.

“These efforts, combined with our continued investments in innovation and operational efficiencies, are laying a strong foundation for continued success.”

Shares of F&N rose 0.8 per cent, or one cent, to $1.25 on May 9.