F&N Well-Capitalised To Manage Rising Energy And Wage Costs, Says CEO

KUALA LUMPUR, Jan 15 (Bernama) -- Fraser & Neave Holdings Bhd (KL:F&N) is well-capitalised to navigate rising energy and wage costs, said chief executive officer Lim Yew Hoe.

He said this reinforces the food and beverage company’s confidence in its strong financial position, robust cash flow, and strategic plans for the future.

“Looking ahead to 2025, while we expect margins to remain tight in light of tax rebate rollbacks in Thailand and higher start-up costs for AgriValley, we are confident of making up for the extra expenditure by optimising our assets and operational efficiencies in Malaysia and Thailand,” Lim said in a statement, in conjunction with its 63rd annual general meeting today.

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He believes the company will remain vigilant and responsive to market shifts, geopolitical uncertainties and macroeconomic changes.

In addition, Lim also sees the potential of artificial intelligence (AI) adoption and automation can further flatten the company chains of command, value, and supply to enhance efficiency,  improve responsiveness and foster a more collaborative work environment.

Lim said that despite the delayed arrival of its first heifers, which postponed the initial milking schedule at the F&N AgriValley dairy farm project in Gemas, the group remains confident in its ability to meet its goal of supporting national food security.

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“Currently, discussions with alternative sources are in progress. Concurrently, work on Phase 1 of the farm’s infrastructure is continuing at pace, in preparation for kicking off operations when the livestock arrive,” he said.

The group is also investing in a new dairy plant in Cambodia’s Suvannaphum Special Economic Zone, along with new lines for carbonated beverages, drinking water in Butterworth, and sterilised milk filling and packing in Pulau Indah.

F&N achieved record full-year revenue of RM5.25 billion, up 4.9 per cent from the financial year 2023 (FY2023), boosted by higher domestic sales by Food & Beverages Malaysia (F&B Malaysia) and Food & Beverages Thailand (F&B Thailand), and exports to Cambodia.

The group operating profit for FY2024 increased by 10.4 per cent to RM709.5 million from the previous year.

Meanwhile, group profit after tax increased by 0.4 per cent year-on-year to RM544.3 million, despite higher tax expenses.

“The group’s performance in FY2024 reaffirms our resilience in a fast-evolving environment.

“We achieved robust profits and maintained a strong cash position despite the higher start-up costs for new ventures,” he said.

-- BERNAMA