CP Foods’ Q3 net profit surges 195 percent from last year’s quarterly loss

Published on
November 22, 2022
A Charoen Pokphand foods processing facility.

Bangkok, Thailand-based food giant Charoen Pokphand Foods reported a sharp increase in its net profit in the third quarter as its operations recovered from disruptions caused by the COVID-19 pandemic.

Its net profit over the period spanning July to September grew 195 percent year-on-year to THB 5.108 billion (USD 141.5 million, EUR 137.8 million), up from a loss of THB 5.37 billion (USD 148.8 million, EUR 144.9 million) in the same period in 2021 when lockdowns to contain the spread of COVID-19 in Thailand and Vietnam hurt consumers’ purchasing power and worsened the company’s operating expenses. The higher net profit in the quarter came largely from better operations of the company’s meat business in Thailand and the increase in the shared profits from its investments. Pork and chicken prices rose in various markets, including Thailand and China, helping its business results improve, CP Foods said.

CP Foods said its total revenue during July-September was at THB 160.266 billion (USD 4.44 billion, EUR 4.32 billion), a growth of 27 percent year-on-year.

Of that total, its operations in Thailand generated a revenue of THB 57.827 billion (USD 1.60 billion, EUR 1.56 billion), up 26 percent year-on-year. Revenue from its overseas operations also increased 28 percent from a year earlier to more than THB 102.439 billion (USD 2.84 billion, EUR 2.76 billion), which CP Foods attributed to higher sales volumes and rising consumer demand following the ease of COVID-19 restrictions in many markets.

In its investor presentation on 15 November, CP Foods said its revenue in the first nine months climbed 21 percent to THB 455.149 billion (USD 12.61 billion, EUR 12.28 billion), while its net profit was up 93 percent to THB 12.158 billion (USD 336.9 million, EUR 328 million).

A breakdown of its sales for the first 9 months of 2022 showed that CP Foods’ revenue from its aquaculture operations in Thailand dropped 1 percent to THB 22.459 billion (USD 622.3 million, EUR 605.8 million). However, its revenue from its aquaculture business in other countries went up –Vietnam reached THB 17.013 billion (USD 471.4 million, EUR 458.9 million), up 13 percent year-on-year; China’s revenue was THB 481 million (USD 13.3 million, EUR 12.9 million); and other markets reached THB 26.33 billion (USD 729 million, EUR 710 million), up 27 percent year-on-year.

Despite the positive growth in the third quarter, CP Foods said the company is dealing with numerous challenges, such as volatile consumption demand, the fluctuation of exchange rates, interest rate hikes, the impacts of the COVID-19 pandemic, geopolitical conflicts, a rise in cost of raw materials, and an outbreak of the African swine fever in various countries.

The company also said it will implement action plans to reduce greenhouse gas emissions throughout its supply chain as part of a broader strategy to achieve a net-zero target by 2050. The strategy will see the company produce more low-carbon products, increase the use of renewable energy, and eliminate coal use from its operations in Thailand.  

Photo courtesy of Charoen Pokphand Foods

Contributing Editor reporting from Hanoi, Vietnam

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