FX Loss and Lower Share of Profit Prompt TU’s 1Q Net Profit to Decline by 20%

Thai Union Group Public Company Limited (TU) has reported its 1Q20 consolidated financial statement through the Stock Exchange of Thailand as follows;

TU reported a net profit of 1,061 million baht in 1Q20, decreased 20.20% when compared to a net profit of 1,273 million baht in 1Q19 mainly due to FX loss and lower equity income from Red Lobster despite strong core business performance. TU’s 1Q20 net profit margin was 3.3%, down from 4.3% a year ago.

 

1Q20 Share of loss from investment in associates was at 18 million baht, from the share of profit of 347 million baht in 1Q19. The decline was mainly due to Red Lobster, along with other businesses in the US, being ordered to close down all of its outlets during the COVID-19 pandemic.

 

In addition, Thai Baht depreciated when compared to the exchange rate as of end-2019, resulting in TU recording an FX loss of 262 million baht during 1Q20.

 

However, the 1Q20 sales grew by 5.9% YoY to 31,103 million baht, which driven by ambient seafood business that delivered 16.2% sales growth YoY, while frozen business experienced a small sales decline of 5.1%. Sales volume also grew of 6.7% YoY, driven largely by the ambient seafood business as consumers practice social distancing and home cooking more.

 

In regard to the impact from COVID-19, giving an overall positive for TU’s operations during 1Q20 as business saw a strong sales push in all regions, driven by increased demand for canned fish included sales in Japan and other Asian countries, otherwise there were some financial impact on frozen seafood business, particularly in the US market.