For the full year, Farm Fresh reported record revenue of RM629.7 million, representing an increase of 25.5% or RM127.8 million as compared to FY2022. Despite the strong increase in revenue, the Group’s gross profit increased by only 9.8% or RM13.3 million due to the increase in raw material costs, higher labour costs following the hike in the minimum wage, higher farming costs, and sales mix impact. As for PBT and normalised PATAMI the group saw a decrease of RM13.5 million and RM13.3 million respectively.
Its Q4 results revenue grew 26.0% or RM33.3 million to RM161.4 million as compared to the corresponding quarter, the group said this was led by positive Ramadhan sales, School Milk Programme sales, and sales increase from its Australian operations. However, despite the increase its gross profit decreased by 10.7% or RM3.9 million due to the elevated raw material costs and higher contribution from its lower margin sales in Australia.
PBT also decreased by RM11.6 million and RM12.5 million respectively, driven by the decrease in gross profit, higher distribution costs, higher salary expenses following the hike in the minimum wage by 25%, higher foreign exchange loss of RM0.7 million and fair value loss on valuation of biological assets of RM1.3 million, a recognition of ESOS expenses of RM0.9 million and an annual fee of RM1.1 million pursuant to Collaboration Agreement with University Putra Malaysia for the use of UPM site.
The group says its Farm Fresh Grow’s sales will continue to improve and is excited about its growing-up milk in powder form, slated to be launched in October 2023.