MALEE still under pressure the rest of this year Adjusts strategies for turnaround next year
15 November 2018
Bangkok – 15 November 2018 – Malee Group Public Company Limited announced its Q3/2018 sales of Baht 1,205 million and net loss of Baht 124 million.
Ms. Roongchat Boonyarat, Chief Executive Officer of Malee Group Public Company Limited (“MALEE”) disclosed the operating results for Q3/2018 that, “In Q3/2018, the Company and its subsidiaries recorded total sales of Baht 1,205 million, a decrease of 20% YoY, and net loss of Baht 124 million, mainly due to sales decrease; higher cost per unit as a result of lower utilization rate; higher depreciation; higher excise tax and sugar tax following the Excise Act, B.E. 2560; sales compensation for branded products; higher selling expenses from multiple new products launch; higher R&D expense; higher audit fees and consultant fees from new businesses establishment; and higher finance costs due to higher borrowings as a result of previous investments in machinery, subsidiaries, and joint ventures.”
Ms. Roongchat continued that “In Q3/2018, the Company’s sales declined 20% YoY, due to the drop in export CMG resulted from a customer ending the distribution contract with some retailer; a decrease in domestic CMG mainly resulted from higher excise tax and sugar tax as well as high base last year; and a drop in domestic branded following the slowdown in fruit juice market plus high sales base last year resulted from new packaging launched which inventory at trade stores were reduced earlier. However, export branded sales continued to grow from sales recognition of Long Quan Safe Food JSC (LQSF), our subsidiary in Vietnam.”
Ms. Roongchat further clarified that “The first nine months of 2018, the Company's sales from the current business dropped quicker and much further than expected, new projects delayed, and costs increased from many factors. The Company expects that its operating results will remain under pressure for the rest of the year. Although the Company expects to continue its loss for the Q4/2018 operating results, the loss magnitude should be less than the Q3/2018 results.”
Ms. Roongchat added that “The Company anticipates its performance to recover in 2019 with sales growth target of 5-10%, mainly supported by continuation of the current product roll-out, product portfolio renovations to match with sales situations, new product development, new sales business model, and securing new customers. In addition, our business direction for next year is aiming at growing production volume, intensified cost reduction measures, and cash flow management.”
“In the long run, the Company is still confident that it will be able to maintain its sustainable growth following business direction and strategy laid out step by step, while the Company has already completed its investment in the must-have projects needed to drive more sales.” concluded Ms. Roongchat.