AGRI-FOOD company Japfa : UD2 0% recorded a profit of US$12.4 million for the first quarter ended Mar 31, 2024, a reversal from a US$43 million loss in the corresponding year-ago period.

The substantial improvement was driven by its businesses based in Indonesia and Vietnam, the company said on Tuesday (Apr 30).

PT Japfa Tbk, the Indonesian unit, performed better due to higher prices and sales volumes. Meanwhile, the animal protein – other (APO) segment in Vietnam benefitted from higher selling prices and lower costs.

Japfa’s revenue for the quarter grew 11.6 per cent year on year to US$1.1 billion, from US$1 billion. Gross profit for Q1 2024 also surged 134.9 per cent to US$181.8 million, from US$77.4 million in the year-ago period. Its operating profit – US$76.6 million – in Q1 this year marked an about-turn from Q1 2023’s operating loss of US$28.6 million.

Feed was a key reason for improvements in the Indonesian and Vietnamese businesses, Japfa said, as it consistently delivered profits with stable margins across major markets.

Other catalysts included higher selling prices of poultry and swine during Ramadan in Indonesia and Tet in Vietnam, which “revitalised demand amid (persistent) cost-of-living pressures”, as well as lower production costs across poultry and swine operations in Vietnam, due to Japfa’s streamlining efforts.

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Noting the “encouraging” financial performance, Tan Yong Nang, chief executive officer of Japfa, said: “While the current results are promising, our commitment to prudent management remains steadfast, especially given the uncertain global conditions, and we remain focused on being one of the (lowest-cost) producers of animal proteins in Asia.”

Shares of Japfa closed at S$0.30, down S$0.01 or 3.2 per cent, on Tuesday, before the announcement.