Profits for the quarter stood at $50.3m, down from $57.4m on a like–for–like basis.
For Q3 2017, the firm actually recorded profits of $1,255.1m, but $1,199.6m of this was due to one-off recognition of fair value reserves in relation to Vietnam Dairy Products Joint Stock Company (Vinamilk).
Revenue stood at $485.0m, up marginally from $483.1m in the last corresponding period.
The improved performance was driven by strong dairy sales and favourable translation effects, but offset by weaker soft drink sales.
This quarter, dairies remained the group’s key contributor – especially Dairies Malaysia and Dairies Thailand where earnings grew 77% and 17%, respectively. Dairies quarterly earnings was further bolstered by Vinamilk’s $38.8m earnings contribution.
Despite that, overall quarterly earnings from dairies fell 8% to $73.6m. The lower earnings was due to the absence of dividend income from Vinamilk this quarter. Excluding the $33.4-million dividend income this time last year, dairies earnings would have surged close to 59 per cent.
Malaysia GST
The down turn in soft-drink sales was attributed to poor performance in Malaysia.
“Sales were adversely impacted by slow off-take post-Hari Raya festive season and the postponement of purchases by customers in view of zero-rated GST which took effect on June 1,” said the company.
“Consequently, Beverages revenue fell 5% year-on-year, to $133.8m. Despite lower revenue, Beverages quarterly earnings grew 38% due largely to lower sugar cost, reduced operating costs and favourable translation effects.”
The firm also confirmed it had successfully subscribed for a 4.21% stake in Tsit Wing International Holdings Limited (TW) at its initial public offering on The Stock Exchange of Hong Kong, at HK$1.98 per share, bringing the total acquisition cost to HK$64.6m ($11.0m).
Established in 1932, TW is a B2B coffee and black tea solutions provider in Hong Kong, Macau and mainland China.
In April, F&N entered into a memorandum of understanding with TW to explore business and product development opportunities for the supply, distribution, cobranded promotion and co-development of products in Hong Kong, Macau, China and South East Asia.