Charoen Pokphand Foods PCL (CP Foods) announces strong rebound in Q2/2024 performance, surpassing expectations. The company reported a remarkable net profit increase of 973 percent, or 10 times the previous amount, driven primarily by its international business. CP Foods also announced an interim dividend payment of THB 0.45 per share.

CP Foods reported sales revenue for Q2/2024 amounting to THB 149,498 million, with 64 percent of total revenue coming from its overseas operations, 30 percent from its Thai businesses, and six percent from exports out of Thailand. Net profit reached THB 6,925 million in Q2 this year, reflecting a 973 percent increase compared to Q2 last year. This substantial growth was mainly attributed to an improved gross profit margin and increased share of profit from associates and joint ventures.

The primary factor contributing to the improved gross profit margin, which reached approximately 15 percent this year, was the reduced cost of animal husbandry, driven by lower raw material costs. Enhanced production efficiency and cost management, along with higher global pig prices, particularly in Vietnam and Cambodia, following the rebalancing of production volume after an oversupply of meat and the recent ASF epidemic, also played a significant role.

Profit from associates and joint ventures totaled THB 3,352 million, marking a 475 percent increase. This was largely due to the better performance of associates in the animal feed and pig businesses in the People’s Republic of China, where pig prices were higher than the same period last year. Additionally, CP ALL Public Company Limited’s improved performance contributed to the overall profit increase.

Prasit Boondoungprasert, Chief Executive Officer of CP Foods, stated that the improved performance represents a recovery of the company’s business back to normal after a challenging year marked by increased costs and a meat glut in several countries. The company has been focused on closely monitoring market conditions, analyzing consumer behavior, and optimizing efficiency across all processes. These efforts have enabled CP Foods to maintain competitive costs and produce products at prices that consumers can afford.

The better-than-expected performance in the second quarter was driven by strong results from overseas operations, particularly in Vietnam and Cambodia, as well as improved performance from the joint venture in the animal feed and pig business in China. Enhanced farming efficiency led to lower overall costs, coupled with higher pig prices compared to the previous year.

Looking ahead to the second half of the year, the company recognizes the ongoing challenges posed by economic conditions and geopolitical conflicts. As a result, CP Foods remains cautious in its investments and continues to develop sustainable innovations to enhance competitiveness. The company is also preparing to adjust its trade strategies to adapt to evolving consumer behavior. Furthermore, CP Foods remains fully committed to its net-zero goal by 2050.

The Board of Directors of CP Foods has approved the payment of an interim dividend for the first half of this year at THB 0.45 per share, representing 46 percent of net profit for the first six months of 2024. The Record Date is set for August 30 (XD on August 29), and the dividend payment date is scheduled for September 13, 2024.