Leong Hup International Berhad released its first 3 months financial report showing its revenue to RM2.09 billion, an increase of 24.5% from the RM1.68 billion recorded in the preceding year’s corresponding quarter ended 31st March 2021. Feedmill segment revenue expanded by 22.9% as the Group improved sales volume in Indonesia and Malaysia as well as pass on part of the soaring raw material cost increases. Meanwhile, the livestock and poultry-related products segment saw a revenue increase of 25.9% as a result of higher volume from broiler sales in Vietnam and Indonesia and higher average selling price (“ASP”) of broiler in Indonesia and eggs in Malaysia.
The Group also benefited from the expanding footprint of The Baker’s Cottage in Malaysia with 185 outlets to date. Profit after tax and minority interests was RM20.4 million for Q1FY22, 71% lower as compared to RM70.3 million for Q1FY21 as the Group’s margins were compressed despite the increases in ASP of feed and livestock and poultry-related products due to the rapid rise in the global cost of commodities.
On geographical segmentation review, Indonesia was the highest revenue contributor to the Group’s revenue at RM804.8 million or 38.6%. Malaysia was the second-highest contributing segment of the Group at RM552.1 million (26.5%). Vietnam contributed RM468.8 million (22.5%) while the remaining contribution was by Singapore at RM197.9 million (9.5%)
and the Philippines at RM60.2 million (2.9%).
Executive Director / Group Chief Executive Officer of LHI, Tan Sri Lau Tuang Nguang shared, “The Group started the year 2022 strongly with Covid-19 coming under control and becomes endemic but as the winds of war grew in Europe, the cost of commodities, especially corn and soyabean meal used in animal feed production increased at a rapid pace. Despite strong demand as economic activities in the region normalise, average selling price increase lagged that of commodity cost increase and the Group experienced margin compression
“The Group has maintained growth and momentum despite the difficult operating environment. We will continue to optimisation cost control and are confident that better days are ahead of us.” He added.
