F&N aims to double revenue growth from Thai dairy unit

June 20, 2011
Source: jThe Borneo Post

BANGKOK: Fraser and Neave Holdings Bhd (F&N) aims to double its revenue growth to RM1.8 billion in the next five years from its dairy operations in Thailand.

Chief executive officer Datuk Ng Jui Sia said its wholly-owned subsidiary, F&N Dairies Thailand, contributed 43.9 per cent or about RM900 million of the RM1.98 billion revenue recorded by the dairies division in the 2009/2010 financial year.

Significant revenue growth could be achieved due to continuing market penetration in Thailand and further expansion to the Indo-China market such as Cambodia, Laos and Vietnam as well as to Myanmar, he told Malaysian journalists, here in conjunction with the opening of F&N Dairies’ milk plant in Rojana, Ayutthaya province, about 70km north of Bangkok.

For the Thailand market alone with a population of about 70 million, F&N wanted to increase its market share in sweetened condensed milk segment from 40 per cent currently to between 60 and 70 per cent in the next five years, he said.

For the sterilised milk category, the company accounted for 45 per cent of the market share in Thailand at the moment.

Ng said more than 20 million cans of F&N Tea Pot condensed milk had been sold in Cambodia, Laos and Myanmar since its introduction in 2008. The plant in Thailand could be used as the springboard to further expand its dairy products into Indo-China and Vietnam with a population of about 200 million, he said.

Apart from their plant in Thailand, F&N Holdings also operated a dairy plant in Petaling Jaya to serve the fast-growing halal market in the Middle East and Africa as well as in Indonesia, Brunei, Singapore and Malaysia.

He said the RM250 million Rojana plant can produce 3.5 million cans per day while its soon-to-be completed RM350 million dairy factory in Pulau Indah, Malaysia with a capacity of 2.4 million cans per day.

“The combined capacities of both plants will generate a collective output of over 5.9 million cans per day could realise our ambition to be a world-class regional player,” he said.

Ng added that the company also planned to expand its dairy plant in Indo-China in the future if it can get its economy of scale.

F&N Holdings acquired RM310 million of the Nestle canned and liquid milk business in Malaysia and Thailand in 2007.

F&N Holdings, which primarily was in the soft drinks and dairies business, had a market capitalisation of RM6.7 billion as at mid-May 2011 and a turnover in excess of RM3 billion for the financial year ended September 30 last year. — Bernama