CPF sees EMS disease main challenge to shrimp sales
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Charoen Pokphand Foods (CPF) is attaching more weight to Early Mortality Syndrome (EMS) shrimp disease in terms of the challenges it faces in driving sales revenue next year than domestic political tension or any foreign-exchange uncertainty arising from
EMS is the critical factor behind the company lowering its revenue target for this year, CPF president and chief executive officer Adirek Sripratak said yesterday. Sales in 2013 are now expected to expand by 10 per cent to Bt390 billion, against the prior growth target of 15 per cent.
The company has joined forces with state agencies and the private sector to help solve the serious problem of EMS, and it is confident that domestic shrimp farming will recover next year, he said.
CPF projects sales revenue of Bt460 billion for 2014, which would represent growth of 15 per cent from this year’s level. Fifteen per cent is the company’s normal average annual growth rate.
Adirek said that neither the uncertain global economic recovery, which could affect the forex market, nor domestic political tension would affect CPF’s sales.
This is because – even if there is an economic slowdown – food is a basic need and people will always continue to consume, besides which rising population levels around the world will bolster food demand, he explained.
“CPF has invested in 12 countries, which can also help mitigate against foreign-exchange volatility. Whether the baht appreciates or depreciates, it will not hurt CPF,” he insisted.
To serve expected rising global consumption, CPF has set aside an investment budget of Bt50 billion for the 2014-2016 period, of which 60 per cent is for the markets in which it is already invested, such as China, Vietnam, Russia, India and the Philippines.
For the domestic market, the company will focus on reinforcing its Five Star brand and increasing the number of CP Fresh Mart shops.
“We will use our cash flow as the main source of funds,” he added.
Meanwhile, the company is in talks to buy a medium-sized frozen-food business in Belgium, with the outcome expected to be known early next year.
The deal will help CPF achieve lower production and transportation costs and also build the CP brand in Belgium, Netherlands, the UK, France and Germany, said the company chief.
