Bairaha Farms records higher 3Q earnings despite market disruptions

Leading poultry firm Bairaha Farms PLC emerged stronger during the three months ended December 2020 (3Q21), as it successfully navigated the market disruptions caused by the pandemic and the supply challenges caused by the shortfall in maize, a key ingredient in poultry feed. 

According to the interim results for the October-December quarter, the company reported revenues of Rs.1.17 billion, up from Rs.1.16 billion in the same period a year ago. 

The company’s top and bottom lines were impacted by the Easter Sunday attacks in April 2019, as the tourism trade went awry and its sales didn’t recover to pre-crisis levels till November, that year. 

It was surprising how good the company had confronted the pandemic-related stresses, as tourism and restaurant trades were nearly decimated for the most part of last year. 

The company said it resorted to door-to-door delivery at the height of the pandemic and launched two new products through the delivery channel itself, taking cognisant of the upended nature of retail and shopping with the pandemic. 

The company reported earnings of Rs.7.54 a share or Rs.120.7 million for the quarter under review, compared to a loss per share of 5 cents or Rs.742.9 million in the corresponding period in 2019. 

For the nine months ended on December 31, 2020, the company reported earnings of Rs.6.88 a share or Rs.110 million on a revenue of Rs.3.64 billion, up 9 percent from the same period a year ago. 

The company is engaged in the complete poultry supply chain via its joint venture and subsidiary companies, as it does chicken processing, parent breeding, production of broiler day-old chicks, broiler farming and value-added meat manufacturing. Bairaha owns a 50 percent of the joint venture Fortune Agro Industries (Pvt.) Limited, which runs a feed mill. The JV helps the company to minimise undue volatility in the supply chain caused by the sporadic issuance of permits to import of corn. 

The company, along with its other joint venture entity Windsor Real Estate Limited, in 2019 completed the acquisition of lands, buildings and silos from CIC Grain Private Limited for Rs.340 million, for the purpose of storage and drying of maize. In January 2020, the government announced an import ban on maize and groundnuts effective from January 15, to help local farmers, due to the bumper harvest.