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Sales Value Growth for TUF Despite Weak Shrimp, Tuna Prices

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THAILAND - Thai Union Frozen Products PCL. (TUF) has reported an encouraging financial result for the first quarter of 2015 with the net profit of THB 1,507 million, showing an impressive growth of 58.7 per cent from the same period last year.

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The net profit jumped as a result of significant foreign exchange gains and continual sales growth while the gross margin of 13.8 per cent maintained at about the same level as in last quarter of 2014.

The group’s consolidated sales reached THB 28,606 million, increased 2.4 per cent from THB 27,948 million a year ago, despite a typically low season of the group. Additionally, sales growth could have been stronger if without the impact of lower tuna and shrimp raw material prices that reduced sales value and impacted its OEM sales.

The strong net profit growth was nevertheless driven by foreign exchange gains and continual strong branded business performance in Europe.

The weakening EURO, despite helping boost the company’s foreign exchange gains in this quarter, did reduce the sales and profit contribution from our European operations which otherwise was a solid performer during the period.

The proportion of sales contribution of TUF’s six strategic categories in the first quarter was generally stable with tuna accounting for 38 per cent , followed by shrimp and related business at 28 per cent , sardine & mackerel business at 6 per cent , salmon at 9 per cent , pet food at 6 per cent and value-added and others at 13 per cent.

Shrimp and related business, sardine & mackerel business and salmon all reported higher sales from a year ago due to the contribution of new acquisitions of MerAlliance, King Oscar and Orion.

In the meantime, the Company’s revenues by markets include the US (43 per cent ), European Union (28 per cent ), domestic market (9 per cent ), Japan (6 per cent ), and other countries (14 per cent ). Partly driven by frozen product category, TUF’s sales in the US has played a vital role in the company’s growth, accountable for 43 percent of total sales. In addition, Q1 2015 domestic sales rose 25 per cent compared to the first quarter of 2014.

Mr Thiraphong Chansiri, President & CEO of Thai Union Frozen Products PCL. (TUF), the world’s leader and expert on innovative and premium seafood products, noted: "Despite the company’s usually low seasonal period, we managed to generate a 58.7 per cent increase in net profit for this quarter. Our 2015 first quarter performance is very satisfactory.”

"Our focus for the remainder of the year is to achieve USD 5 billion revenue target through organic growth within core product categories and improved higher efficiency in all our operations across the globe,” Mr Chansiri concluded.