Beverage and publishing company Fraser and Neave (F&N) saw a 10.9% drop in its net profit to $40.2 million in 1QFY2022 ended Dec 31 2021, from the $45.1 million in the year before.

This comes despite a 1.6% uptick in the company’s revenue to $496.5 million in 1QFY2022, thanks to higher demand for beer and soft drinks.

F&N notes that the higher revenue for beer was driven by improved route-to -market while a recovery in general retail food services boosted sales for soft drinks.

Meanwhile, the company notes that revenue from dairies fell by 1% largely due to volume in Malaysia which has been impacted by lower domestic and export sales.

In this time, income from Publishing and Printing edged down on the back of lower textbook adoption and timing difference in international sales.

See also: <a class='gtm_see_also_1_inread' style='text-decoration: underline;' href='/capital/results/ntuc-income-reports-premium-growth-fy2021-lower-net-operating-surplus-fair-value?utm_source=website&utm_medium=article&utm_campaign=ONPAGESEO'>NTUC Income reports premium growth for FY2021 but lower net operating surplus on fair value loss</a>

Geographically, revenue contribution from Singapore came in at 24% due to a recovery in food services and general retail.

Growth from Malaysia – which made up 36% of total revenue – came in flat following lower dairy sales.

Income from Thailand , which made up 34% total revenue, took a hit from unfavourable foreign exchange translation.

Overall, F&N reported a 21.3% drop in its profit after tax to $50.8 million, due to the issuance of a $100 million 5-year term bond at the end of the year to prepare for the refinancing of a bond that is due in March.

See also: <a class='gtm_see_also_2_inread' style='text-decoration: underline;' href='/capital/results/serial-system-reports-lower-1qfy2022-earnings-allowance-obsolete-stocks?utm_source=website&utm_medium=article&utm_campaign=ONPAGESEO'>Serial System reports lower 1QFY2022 earnings on allowance for obsolete stocks</a>

The drag also comes from $8.1 million incurred in exceptional items such as the impairment of inventories and property, plant and equipment due to the flash floods in Malaysia.

As at Dec 31, F&N’s borrowings stood at S$952.8 million and its gearing ratio at 13.7% for the quarter. This gives it "generous debt headroom for acquisitions", it said in a regulatory filing on its business update.

Shares in F&N were down a cent or 0.71% at $1.40 as at 11.18am on Feb 11.

F&N sees 10.9% drop in net profit to $40.2 million in 1QFY2022

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F&N sees 10.9% drop in net profit to $40.2 million in 1QFY2022

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