MFM: MFM Q3 profit jumps on improved poultry integration operations

PETALING JAYA: Poultry processor and flour mills operator Malayan Flour Mills Bhd (MFM) net profit for the third quarter ended Sept 30, 2022 soared almost 12 folds to RM46.21 million from RM3.91 million a year ago, attributed largely to the improving operations of the group's poultry integration (PI) segment. Revenue increased 28.8% year-on-year to RM799.45 million from RM620.52 million on higher selling prices and production volume. However, for the cumulative nine months year-to-date, net profit dwindled 34.5% to RM98.17 million from RM149.88 million. Revenue for the nine months rose 21% to RM2.1 billion from RM1.73 billion, underpinned by price adjustment strategy in the flour and grains trading segment which supported the growth of 20.8% with demand improving as the countries move towards Covid-19 endemicity.MFM executive deputy chairman Teh Wee Chye (pic) said its Q3'22 numbers reflect the success of an integrated business model of flour milling and poultry processing. "Going forward, the flour milling business will continue to sustain our earnings, while the poultry integration segment is expected to enhance profit contribution to MFM as we accelerate the capacity utilisation at our primary processing plant," he added. MFM said the prices of wheat are expected to stay elevated into 2023 due to global weather challenges, even as some commodity prices are beginning to stabilise. In addition, rising inflation and the weakening of the ringgit in the face of a strong US dollar will further compound the cost pressure. Given these pressures, the group's flour operations in Malaysia and Vietnam are expected to be impacted.Nonetheless, the company is optimistic of its outlook for the remaining of 2022 and beyond as the Malaysian government has partially lifted its chicken export ban on Oct 11, 2022 after imposing it on June 1, 2022, as well as improved domestic economic prospect and partnership with Tyson International Holding Company since end May 2021.