MD & A
Explanation and Analysis of the Management
(1) Overview of the Company and its subsidiaries.
- The snack market in 2016 grew at a similar rate to the year before. The Company has implemented marketing strategies, including on products that focus on providing benefits to consumers in terms of quality, taste and nutritional value in line with the ever changing needs of the consumers, on distribution channels that facilitate consumer purchases, on efficient inventory management, on continuously organizing advertising and sales promotion activities, and on expanding new customer base.
- For the tuna products and seafood products for export, the Company continues to place importance on product development, as well as use of technologies in the production of goods, and on quality management system in all production processes that are traceable for which it has received international standards certification that are recognized by customers overseas. It also emphasizes on producing products that are environmentally friendly, which allowed the Company to gain continuous trust in its products, with emphasis on the Asian, European, American, Australian and Middle Eastern markets.
(2) Results of the Operation
- Net profit for the period amounted 345.1 million Baht, down from the same period last year by 88.1 million Baht from realization of share of loss of joint venture and associated companies that increased by 37.4 million Baht, income tax expenses that increased by 40.3 million Baht due to the expiration of tax incentives under the investment promotion privileges of a subsidiary, loss from change in value of current investments that decreased by 20.7 million Baht due to the reclassification of investments in open-ended equity funds to investments in available-for-sales securities.
- Profit from operating activities of the Company and its subsidiaries was 521.2 million Baht, down from the same period last year by 31.7 million Baht. Significant changes in the operating performance for the period are as follows:
Net revenue from sales and services for the period was 3,148 million Baht, decreasing from the same period of the year before by 3 million Baht because during the year the Company organized sales promotion activities that correlate with sales thus causing net sales revenue to decrease. Gross profit margin was 25.7%, down from the same period of the previous year by 0.6%.
ค่Selling expenses was 310.1 million Baht or a ratio of 9.9% to sales revenue (2015 : 11.0%), decreasing from the same period of the year before by 35.7 million Baht from the decrease in advertising expenses of 36.5 million Baht.
Administrative expenses was 172.1 million Baht, up from the same period of the previous year by 12.3 million Baht due to the increase in personnel expenses of 10.5 million Baht from the expansion of the marketing and support units together with the annual salary adjustment and the increase in management expenses of 1.8 million Baht.
Food Production Segment
Net revenue from sales and services for the period was 2,111 million Baht, down from the same period of the year before by 132 million Baht resulting from the decrease in export of tuna products. Gross profit margin was 14%, which compared with the same period of the previous year resulted in a profit for this segment of 287 million Baht, a decrease of 17 million Baht from the year before.
Other revenues was 29.4 million Baht, increasing from the same period of last year by 9.6 million Baht due to the increase in gain from exchange rate and other income of the food production segment for the period.
Administrative expenses for the period was 298.9 million Baht, up from the same period of the previous year by 33.1 million Baht due to the increase in personnel related expenses of 22.7 million Baht from the expansion of the marketing and support units of the distribution segment together with the annual salary adjustment, increase in consulting fees of 4.8 million Baht, increase in rental and repair expenses of 1.6 million Baht, increase in donations of 1.3 million Baht, increase in travel expenses of 1.0 million Baht and increase in other expenses of 1.7 million Baht.