Fraser & Neave Holdings Bhd (F&N) is set to commence operations for its beverages plant in Penang as early as August 2025.
F&N Chief Executive Officer Lim Yew Hoe said that once the plant in Butterworth, Penang, previously used for glass bottle manufacturing, began its operation, it would house new production lines for carbonated soft drinks and drinking water catered to the northern Peninsular Malaysia markets.
“By shifting part of the production to the north, we can save on logistics costs while allowing us to better serve the local markets and reduce our carbon footprint compared to servicing from the Shah Alam main plant, particularly when both the factories at Shah Alam and Bentong are operating at full capacity,” he said.
He added that the company is in the process of obtaining halal certification and other necessary approvals before operations can begin.
Meanwhile, Lim said the company expects its dairy farming venture in Gemas, Negeri Sembilan, to break even within three to five years.
“We have welcomed the safe arrival of its first commercial batch of 2,500 dairy heifers from Chile to the dairy farm in Gemas on April 15 and the milking operations of these cattle are scheduled to commence in June 2025, with the expected production of 29 million litres of milk annually.
“We plan to expand it to 10,000 dairy cows in the first phase, before reaching a target of 20,000 cows in the second phase to achieve breakeven,” he added.
Lim revealed that of the company’s total capital expenditure of RM1.8 billion investment, approximately RM600 million has already been spent on the construction of facility infrastructure, while approximately RM100 million has been allocated for the acquisition of cows from Chile
“This is part of our long-term strategy to reduce dependency on dairy imports and strengthen the local raw milk supply,” he said.
Looking ahead, Lim said the group remains cautious on the near-term outlook amid an uncertain global economic environment, market volatility and an evolving regulatory landscape.
“Other key project in the pipeline apart from the commencement of the dairy farm is the development of a dairy manufacturing plant in Cambodia, the first factory outside of Thailand, that is on track for commercial start in early 2026 which is expected to contribute to the local economy,” Lim added.
On April 28, F&N reported a lower profit after tax (PAT) of RM140 million for the second quarter ended March 31, 2025 (2Q25), compared to RM165.7 million in 2Q24.
PAT was due to the full utilisation of Thailand’s Board of Investment (BOI) incentive for Food & Beverage (F&B) Indochina since 3Q24 and withholding taxes on dividends repatriated from F&B Indochina.
Revenue for the quarter under review also declined by 1.4% to RM1.33 billion from RM1.35 billion in 2Q24.
Despite the setback, F&N declared an interim single-tier dividend of 30 sen per share for the financial year ending Sept 30, 2025. The dividend, amounting to RM110 million, is payable on May 30, 2025.
