CPF plunges to Bt1.14-bn loss in Q1
As a sign of the economic times, one of Thailand's strongest companies, Charoen Pokphand Foods (CPF), has recorded a first-quarter net loss of Bt1.14 billion, due mainly, the company says, to a decline in domestic prices for meat products, the appreciation of the baht and increased prices for raw materials.
However, president and CEO Adirek Sripratak yesterday informed the Stock Exchange of Thailand of hopes for an improved situation in the second quarter onwards.CPF said prices for pork and chicken had declined significantly in the first quarter, while costs for raw materials for feed products had risen, forcing the gross margin of the company and its subsidiaries down from 13.3 per cent to 7.9 per cent. Adirek said CPF's first-quarter sales reached Bt29.08 billion, up 6 per cent year on year, because external business had grown as expected. However, domestic sales contributed 69 per cent to the first-quarter total. Seventeen per cent came from exports and 14 per cent from international businesses. Oversupply and slower spending by consumers drove domestic meat-product prices down, particularly those for pork, chicken and eggs. On the other hand, the price of corn - the main raw material for feed products - increased significantly, and the baht strengthened at the same time. These factors led the company to record a net loss of as much as Bt1.14 billion, compared with a net profit of Bt550 million in last year's first quarter, he said. In addition, the company has changed its accounting treatment for investments in subsidiaries and associates, by recording these investments using a cost method instead of an equity method. The Nation
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