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performance through effective execution of commercial strategies, supported by a sharper focus on cost management initiatives.
Looking ahead, Heineken Malaysia expects the business environment to remain challenging given the intense competition and the continued presence of contraband beer in the market. The group commended the extensive efforts of the government and the Royal Malaysian Customs Department for stepping up enforcement against contraband alcohol and illicit trade, which represent a signi cant loss of revenue to both the government and industry. It also urged that there be no increase in excise duties on beer to ensure the price gap between duty-paid products and
contraband is not widened further. The group said it will continue to strengthen its commercial strategies and execution to drive performance with a focus on improving operational ef ciencies across the business to achieve a commendable performance.
October last year, Nestlé (Malaysia) Bhd agreed to of oad its Malaysian chilled dairy business and its Petaling Jaya Milo factory to French dairy company Lactalis, and will use the proceeds to expand its Milo factory in Chembong, Negeri Sembilan. As a result of the divestment, Nestlé will invest RM100 million to expand its Chembong Milo production facility, which will establish the site as the world’s largest Milo factory. It will also move all existing Milo manufacturing operations from its Petaling Jaya plant to consolidate and expand Milo production at the Chembong plant.
In terms of performance, for the third quarter ended September 30, 2018 (3QFY18), Nestlé’s net pro t expanded 15.7% to RM137.7 million from RM119.01 million in the same period a year ago. This was mainly due to higher sales within the zero-rated Goods and Services Tax (GST) period from June to August. Its revenue rose 8.3% to RM1.4 billion in the quarter from RM1.3 billion in the corresponding period last year. The higher turnover coupled with an improved margin contributed to an additional gross pro t of almost RM100 million. Nestlé said the favourable price trend in major raw materials and its continuous drive for ef ciency increases along the supply chain led to this margin improvement. The quarter also saw strong marketing and promotional activities supporting the higher sales and this was re ected in the higher operational expenses recorded.
Biscuits manufacturer Hup Seng Industries Bhd’s net pro t for the fourth quarter ended December 31, 2018 (4QFY18) fell 11.5% to RM12.74 million from RM14.38 million a year ago mainly due to poorer margin in certain segments coupled with higher incentive and promotional sponsorship activities given to the distributors during the current quarter. Group
MALAYSIA FOOD BUSINESS DIRECTORY 2019/2020
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