Keells Food Products PLC (KFP), the processed food manufacturing arm of the country’s largest conglomerate, the John Keells Group, recorded a 31 percent year-on-year (YoY) fall in its net profits to Rs.48.49 million for the fourth quarter of 2017 (4Q17) amid challenging conditions and effects from negative publicity campaigns.
Basic earnings per share fell to Rs.1.90 from Rs.2.77 YoY, against a share price trading at Rs.159.90.
Revenue fell 1 percent YoY to Rs.717.11 million, while cost of sales also fell 1 percent YoY to Rs.518.26 million.
An operating profit of Rs.67.10 million was recorded, down 24 percent YoY due to increased administrative, and selling and distribution expenses.
KFP’s net assets per share fell to Rs. 65.50 at the end of the financial year compared to Rs. 69.46 at the start of the financial year, while the asset base marginally fell to Rs.2.41 billion in the same time span.
For the 2017 financial year (FY17), KFP’s net profits fell 18 percent YoY to Rs.275.42 million.
John Keells Group Chairman Susantha Ratnayake said that this was “as a result of challenging market conditions as well as slower than anticipated recovery of the processed meat market from the negative publicity in the previous year.”
However, he said that the company focused on expanding its distribution network and coverage. KFP also introduced three new products to the market during the year.
Basic earnings per share for FY17 fell to Rs. 10.80 from Rs.13.13 YoY.
Revenue for the year increased 1 percent YoY to Rs.3.05 billion, while cost of sales remained flat at Rs.2.15 billion. Operating profits fell 11 percent YoY to Rs. 380.35 million.
The John Keells Group owns 89.89 percent of the shares in KFP.