HONG KONG: Dairy Farm International FY Profit Up Strongly

Dairy Farm International has reported a strong rise in full-year profit, even as sales grew modestly.

For the year ending 31 December 2016, net profit was up 11% to US$469m (+7% underlying basis), while sales were up 1% to $11.2bn (+14% to $20.4bn including associations and joint ventures). The group said its margins improved as well, helped by a strong performance at its Food Division and IKEA, as well as at the Maxim’s and Yonghui banners

Sales at the Food Division were flat at $8.2bn (+1% constant-currency), as weakness in Southeast Asia offset modest growth in Hong Kong. Sales at the Health & Beauty division rose by 3% to $2.6bn (+4% constant-currency), despite weakness in Malaysia, while the Home Furnishings division saw sales grow by 5% to $597m.

The group opened a net 114 new outlets last year, including 97 supermarkets & hypermarkets and 46 convenience stores.

Dairy Farm said it expected a “significant degree of economic uncertainty” in 2017, but will focus on modernising its infrastructure, improving its digital presence, and bolstering its customer offer.