CPF CEO and President Adirek Sripratak (Photo: CPF)
CPF invests USD 939 mln to boost foreign revenue
Wednesday, August 18, 2010, 01:10 (GMT + 9)
Farmed white shrimp giant Charoen Pokphand Foods Plc (CPF) is following through with its overseas investment of at least THB 30 billion (USD 938.9 million) through 2015 in an effort to advance its plan to bolster foreign revenue contributions to 40 per cent in the next five years.
"We are committed to investing THB 6 billion (USD 187.8 million) a year over the next five years to expand production of animal feed and livestock at home and overseas," said company CEO and President Adirek Sripratak. "Over 60 per cent of that amount will go overseas, largely to expand existing operations in Russia, India, Turkey, the Philippines, Malaysia and some African countries."
CPF’s sales growth for the first six months of the year relied heavily on overseas operations, allowing that sector to skyrocket by 91 per cent. Thai operations climbed at a pace of 7 per cent.
For H1, the company had total sales of THB 91.47 billion (USD 2.9 billion), 21 per cent higher against the same period in 2009. Net profit in H1 soared by 82 per cent to THB 7.22 billion (USD 226 million), partially backed by income distribution from affiliate CP All Plc, the operator of 7-Eleven convenience stores in which CPF possesses 27 per cent, and others, reports Bangkok Post.
For the second quarter of 2010, CPF reported a net profit of THB 4 billion (USD 125.2 million), 25.3 per cent higher compared to Q2 2009 on total revenues of THB 48.49 billion (USD 1.5 billion), a rise of 18.47 per cent.
The jump in sales revenue, Adirek said, could have been caused by higher food product sales and increasing income abroad.
The shrimp business profited from a worldwide fall in production due to irregular weather conditions and the BP oil spill in the Gulf of Mexico.
As of Q2, overseas operations constituted 27 per cent of CPF sales. Exports made up 13 per cent and domestic sales 60 per cent.
The company's five-year plan says that the firm intends to lift the revenue contribution from overseas operations to 40 per cent, with exports comprising 20 per cent and domestic sales 40 per cent. Adirek said the company anticipates a record profit of over THB 12 billion (USD 375.5 million) for the year.
CPF had a record net profit of THB 10.19 billion (USD 318.9 million) last year, up by a whopping 226 per cent from 2008, with a sales revenue increase of 6 per cent to THB 165.06 billion (USD 6.2 billion). Revenue approach THB 180 billion (USD 5.6 billion) this year, which the firm foresees will grow by an average of 10 per cent by 2015.
"We have done better than targeted with increasing revenue from overseas businesses," he said. "Our investments in over 10 countries will pave the way for future growth."
He added that prospects also look hopeful for H2, such that contributing a profit growth target of 20 per cent in 2010 will be attainable.
Thailand-based CPF‘s fully integrated operations span aquatic feed for shrimp and fish, aquatic breeds, shrimp and fish aquaculture and meat and food products.
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By Natalia Real