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Seafood Processing



Strong fourth quarter for Thai Union. Thai Union Group PCL reported a 3.7 percent year-on-year rise for fourth quarter 2018 sales to a record THB 36 billion. The fourth quarter 2018 operating profit improved 55.2 percent year-on-year to THB 1.50 billion, the highest quarterly margin in two years. The Frozen, Chilled Seafood, and PetCare businesses contributed to the stronger performance with price adjustments and operational improvements.

Consolidated FY2018 sales declined 1.2 percent year-on-year to THB 133.28 billion due to the Thai baht’s appreciation against the U.S. dollar. Excluding foreign currency impact, FY2018 sales would have increased by 0.5 percent year-on-year. FY2018 gross profit was down 2.2 percent year-on-year, due to material prices and foreign exchange rate volatility, mainly during 1Q18.

FY2018 Selling, General & Administration to sales ratio further reduced at 10.7 percent, as the company continued to focus on cost efficiencies with expenses down 1.2 percent year-on-year. FY2018 free cash flow came in at THB 8.40 billion, almost tripling FY2017, resulting in the company’s debt payment of THB 3.5 billion.

“Despite challenging market conditions, we stayed firmly focused on operational excellence and profitability improvement. The good results from last quarter gives us confidence that 2019 will see a stronger and successful year,” said Thiraphong Chansiri, CEO of Thai Union.

Thai Union announced a final dividend of THB 0.15 per share, making a FY2018 dividend of THB 0.40 per share.

Sales in North America continued to play an important role in the company’s revenue, accounting for 39 percent of total sales, while Europe contributed 30 percent. Thailand’s domestic market grew to 11 percent of total sales, with Asia Pacific, Middle East, Africa and South America contributing 20 percent.

In 2019, Thai Union targets to achieve 5 percent increase in organic sales growth and 15 percent gross profit margin. The company aims to maintain stringent cost control initiatives to keep SG&A-to-sales ratio at around 10% level. These should result in further profit recovery in 2019.

Thai Union continued to implement important initiatives last year in line with its sustainability strategy, SeaChange®, including joining the Global Ghost Gear Initiative to help reduce the growing problem of abandoned, lost and discarded fishing gear (ALDFG) worldwide.

In 2018, the company publicly reported on the substantial progress it made on the 2017 landmark agreement with Greenpeace to implement measures to tackle illegal fishing and overfishing. Thai Union also released its first annual Tuna Commitment Progress Report, as part of its ambitious strategy to ensure 100 percent of its branded tuna is sustainably sourced.

The company’s sustainability efforts were widely recognized. In 2018, Thai Union was ranked Number 1 in the world in the Food Products Industry in the Dow Jones Sustainability Index, and achieved 100th percentile ranking for total sustainability score. Thai Union has now been named to the DJSI for five consecutive years, reflecting its commitment to be a leading company globally in sustainability.

In addition, Thai Union was listed on the FTSE4Good Emerging Index for the third straight year; was highly commended in the Thomson Reuters Foundation Stop Slavery Award; received the Global Good Awards UK Gold Award for best Sustainable Supply Chain; awarded the Business Intelligence Group Sustainability Leadership of the Year; named FinanceAsia’s best at Corporate Social Responsibility; and Dr. Darian McBain, Thai Union’s Global Director of Corporate Affairs and Sustainability, was awarded Sustainability Leader of the Year at the prestigious edie Sustainability Leaders Awards.