MAIN Market-listed integrated poultry producer CAB Cakaran Corp Bhd kickstarted its financial year ending Sept 30, 2023 (FY9/2023) in a strong position as the group’s net profit doubled to RM41.87 mil for its 1Q FY9/2023 ended Dec 31, 2022 from RM18.19 mil in the corresponding quarter a year ago.
At the same time, CAB Cakaran also reported a 12.8% rise in its revenue to RM557.3 mil during the period under review from RM494.21 mil in 1Q FY9/2022.
According to its Bursa Malaysia filing, the higher revenue was attributed to higher sales achieved by most of the group’s divisions, especially the integrated poultry division.
The integrated poultry division posted a 14.37% increase in its revenue from the corresponding quarter a year ago due mainly to the higher average selling price of feed, processed chicken and most of the further processed food products.
In line with the higher sales coupled with the subsidies from government, CAB Cakaran’s integrated poultry division generated an operating profit of RM65.3 mil during the quarter under review which represents an increase of 89.2% as compared to 1Q FY9/2022.
Meanwhile, its supermarket and fast-food divisions reported lower operating profits during the quarter under review. For the supermarket division, it was mainly due to the lower sales generated by most of its outlets while the fast-food division’s operational profit was affected by higher cost of goods.
“The local poultry industry is beginning to show improvement in production output after the COVID-19 pandemic and the arrival of foreign workers since October last year,” commented CAB Cakaran on its latest financial results.
“While the industry still needs more time to return to the pre-COVID period, there are signs that the worst is over. Despite this, the local poultry industry continues to face challenges from high feed costs, the outbreak of diseases and changes in weather conditions.”
Nevertheless, the group expects the continuing subsidy provided by the government will ensure that poultry farmers will not be adversely affected by these challenges.
CAB Cakaran also believes that demand for chicken meat will remain high as it is the cheapest source of meat protein. It added that the per capita consumption of chicken meat in Malaysia is around 50kg which is one of the world’s highest.
The strong demand will keep prices of broilers high over the next quarter as the supply situation remains unstable. As such, the management will pay close attention to the upstream activities to ensure that the group is in a position to meet its production target as well as to take necessary actions to improve operational efficiency within the group.
At the close of today’s trading, CAB Cakaran was up 1 sen or 1.92% to 53 sen with 2.94 million shares traded, thus valuing the company at RM372 mil. – Feb 28, 2023
