Thai Union Frozen Products Plc (TUF) plans to emphasize high-margin products to meet this year’s revenue target goal, the Bangkok Post reported on May 22. Thiraphong Chansiri, president and chief executive officer of the company, said a strategy has been enacted that includes “cementing profits, improving production efficiency and strengthening cash flow.”
The ceo’s statement came shortly before a military coup d’état went into effect in Thailand. According to the Bangkok Post, business leaders reacted calmly to the coup and did not foresee the Thai economy becoming much more negatively affected than it already has been over the past seven months.
“Many (including the Thai Federation of Industries) even lauded the military action for breaking the prolonged political impasse and paving the way for the Thai economy to revive growth and regain investment confidence,” reported the Bangkok Post’s online edition in the early hours of May 23.
Meanwhile, TUF anticipates generating receipts of US$ 4 billion this year. First-quarter revenues hit $863 million, resulting in a net profit rise of 41%. This was primarily attributed to tuna and shrimp sales. The quarterly gross profit margin of 14.9% is expected to rise in the second quarter if tuna prices remain stable and the baht does not gain in value.
Noting that tuna prices have recently fallen to $1,200 a ton from $1,950 last year, Thiraphong said if prices and the early-mortality syndrome (EMS) situation that has curtailed shrimp production improve, TUF’s gross profit margin could reach 15-16% next year.
“We’ve rearranged our portfolio, and this year will focus only on introducing high-profit products,” he commented.
