CPF reports 43% spike in earnings

Prasit Boondouangprasert

Charoen Pokphand Foods Public Company Limited (CPF) reported a 6.111 billion baht net profit in Q1, 2020, a 43% jump year-on-year due to the African swine fever outbreak.

The company reported 138.135 billion baht turnover in the first quarter, up 10% y-o-y. Offshore sales revenue in 16 countries contributed around 68% of total revenue, up 12% this year. Domestic market share added 32% of total revenue, up 6% y-o-y. 

Prasit Boondoungprasert, CEO, said that the increase in net profit was due to its pork business in Vietnam. CPF has started to realize revenue from Hylife Co Ltd, a pork business operator in Canada, in Q1, 2020. Hylife is looking at possible investments in a hog business in the United States.

He foresees that the hog industry will continue to grow robustly for the next 1-2 years as small and medium-sized farms vanish from the scene. ASF will linger, and a corn and soybean glut will continue for a few more years due to slumping market demand. 

Broiler prices in the domestic market will rise as producers cut back weekly output to 30 million birds/week vs 35 million earlier this year.

Poultry exports to China and Singapore will drive poultry demand on the local front.

Covid-19 did not have an effect on CPF’s food business, he said, but added that the company has decided to take a conservative position. 

CPF looks set to invest 20 billion baht in 2020, up from its earlier target of 2.5 billion baht. Apart from infrastructure, political stability, and availability of workers, CPF will take into account the medical infrastructure of target countries for its new round of overseas investment projects.