Thai Union Group PCL reported record high revenue of THB 36.3 billion in the first quarter of 2022, a 16.5 percent increase from a year earlier, driven by a favorable foreign exchange environment and continuing robust global demand as many countries continued their return to normalcy and reduced their preventative pandemic measures.
Cost containment and ongoing consumer trust and demand for the Company’s healthy and nutritious products across Asia, Europe and North America, resulted in a 15.4 percent increase in gross profit to THB 6.4 billion year-on-year. But, as a result of ongoing headwinds due to inflationary pressures as well as increased supply chain and global logistic constraints, Thai Union’s net profit decreased 3.2 percent to THB 1.7 billion.
“While we face persistent challenges, I am pleased that we were able to deliver a strong quarterly result and top line growth across our three core business units,” said Thiraphong Chansiri, CEO of Thai Union Group. “Thai Union also continues to prioritize the health, wellbeing and safety of its employees in light of the ongoing pandemic and Omicron variant, by enforcing strict COVID-19 preventive measures. This has allowed us to continue to manage our global production network well, and to deliver safe, quality, nutritious food products to consumers around the world.”
Robust global demand was reflected in higher sales across all business segments, with sales for ambient seafood growing 14.3 percent to THB 15.5 billion during the quarter, supported by both stronger sales volumes, a favorable foreign exchange environment, and an increase in selling prices.
The frozen and chilled seafood business reported a 14.2 percent rise in sales to THB 13.8 billion, driven by continued strong demand, particularly of shrimp products in Asia, and the recovery of the foodservice sector in the U.S. and Europe as well as a favorable foreign exchange environment. The Company has also utilized automation to improve production efficiency and manage cost per unit.
PetCare, value-added and other businesses, continued to play a significant part in the Company’s growth in 1Q22, with sales jumping 27.2 percent to THB 7.0 billion, as people continued to spend more on their pets and as the Company continued to offer innovative products, while also reporting higher sales in the packaging business.
During the first quarter, Thai Union continued to expand its business in various markets and sectors, including establishing a joint-venture company – RBS-TU Food Ingredients Private Limited – with R&B Food Supply Public Company Limited (RBF) and Srinivasa Cystine Private Limited (SCPL), an associate of Avanti Group, to provide high-quality food ingredients to the Indian market.
Thai Union also took steps to better manage its supply chain over the quarter, through the launch of a new joint venture with Pacific Cold Storage Co., Ltd., a subsidiary of JWD InfoLogistics Public Company Limited. The new company – Pacific TUM Cold Storage Co., Ltd. – will build a cold storage facility in Thailand’s Samut Sakhon province to handle Thai Union’s growing raw materials.
“But, while we will continue to focus on opportunities, challenges remain, including the ongoing impact from Omicron, and continued headwinds due to increased supply chain and global logistic constraints as well as inflationary pressures,” Chansiri said. “But business diversification remains a key strategy for us as we continue to invest and expand our business into high-margin areas where we can use innovation to create greater value, and optimize materials processed in our plants. With a focus on health and wellbeing across our Group’s portfolio, we will strengthen the growth and profitability of our core businesses and expand into new, attractive areas to support our commitment to Healthy Living, Healthy Oceans.”