Food Empire has reported earnings for 2HFY2021 that was down 40.6% y-o-y to $7.87 million, even though revenue increased 22.1% y-o-y to $171 million. For whole of FY2021, earnings dropped 26.9% to $19.3 million, while revenue was up 17.5% to $320.6 million.
According to the company, higher sales was offset by even higher growth in costs of raw materials and logistics.
Food Empire plans to pay a first and final dividend of 1.62 cent and a special dividend of 0.58 cent.
In its earnings commentary, the company notes that even with daily infection rates in its main markets of Russia and Ukraine, its sales has remained “resilient” and that demand has even improved.
However, the company warns that the performance is overshadowed by the on-going conflict between Russia and Ukraine.
“Although the current raft of sanctions are unlikely to have a direct or immediate impact on business prospects in these markets, it has an adverse impact on the volatility of the exchange rates of the Russian Ruble and Ukrainian Hryvnia and further exert inflationary pressure on commodities prices and energy costs,” Food Empire adds.
“In spite of the difficulties brought by the current conflict, the group remains confident on consumer demand for all of its markets including Russia and Ukraine having local manufacturing facilities to service changing demands and trends. The management is closely monitoring the fluid situation and will do its best to manage.”
Earlier in the day, ahead of the earnings announcement, Food Empire shares tumbled as much as 8% as news broke that Russia has started its invasion of Ukraine. Russia, Ukraine and other former Soviet states contribute around 57% of Food Empire's revenue in 2HFY2021.
Food Empire closed the day at 58 cents, down 5.69%, and down 24.7% year to date.
