Monde Nissin Corporation Reported H1-2024 Core Net Income Growth of 45.5%

Monde Nissin Corporation (Monde Nissin) announced its unaudited financial results for the first half of the year ended June 30, 2024. Consolidated revenue for the first half increased by 3.1% to P40.1 billion on a comparable basis, with second quarter growth at 4.2%.

Gross profit for the first half grew by 19.0% to P13.9 billion as second quarter gross profit increased by 17.0%. Gross margin for the first half increased by 464 bps year-on-year on a comparable basis to 34.7%, driven by APAC BFB gross margin improvement of 576 bps year-on-year due to lower commodity costs and pricing. Gross margin for the second quarter improved by 373 bps year-on-year on a comparable basis to 34.0%, mainly driven by lower commodity costs in the APAC BFB business.

Core net income attributable to shareholders for the first half increased by 45.5% to P5.1 billion, while it increased by 36.5% to P2.2 billion in the second quarter due to higher core net income in the APAC BFB business. Reported net income for the first half grew by 17.4% to P4.1 billion despite a 60.7% decline in reported net income to P610 million during the second quarter to a non-cash accounting loss of P1.5 billion on the fair value of Meat Alternative guaranty asset. Total comprehensive income, which includes cumulative translation adjustments, grew by 46.2% in the first half and 5.7% in the second quarter.

Asia-Pacific Branded Food and Beverage (APAC BFB)

APAC BFB net sales for the first half grew by 3.9% to P33.3 billion, while it rose by 5.7% in the second quarter, largely driven by volume growth in noodles and other categories. The domestic business grew by 4.0% for the first half as Q2 growth rose by 6.2%

Gross profit for the first half increased by 22.8% to P12.5 billion, while it increased by 19.0% in the second quarter. Gross margin improved by 576 bps year-on-year to 37.4% in the first half and increased by 405 bps year-on-year to 36.2% in the second quarter due to lower commodity costs. Core EBITDA increased by 26.0% to P8.3 billion in the first half and grew by 22.9% to P3.7 billion in the second quarter due to gross profit improvement.

Meat Alternative (Quorn Foods)

Meat Alternative revenue declined by 5.2% and 6.4% on a comparable and constant currency basis in the first half and second quarter, respectively, as category softness continues. On a reported basis, revenue declined by 4.2% in the first half and 5.6% in the second quarter. Foodservice sales per day in Q2 grew by 8% on a comparable and constant currency basis.

Gross profit for the first half declined by 5.6% to P1.5 billion on a comparable basis, while gross profit in Q2 improved by 3.9% on a comparable basis. Gross margin in the first half declined by 115 bps year-on-year to 21.5% on a comparable basis. Gross margin in the second quarter improved by 146 bps year-on-year to 23.1% due to lower raw materials and utilities costs, partially offset by lower production volume as we bring down inventory, impacting fixed costs recovery. Gross margin improved sequentially by 313 bps in Q2 compared to Q1. Core EBITDA loss of P144 million in the first half was due to lower gross profit, while core EBITDA loss of P84 million in the second quarter was due to lower gross profit and higher marketing expenses, partially offset by the restructuring benefits.

Monde Nissin’s financial position remains strong with P13.0 billion in cash and cash equivalents and a stable net debt-to-equity ratio of 0.12. The outstanding debt was at P3.2 billion as of June 30, 2024. Operating cash flow was at P6.0 billion for the first half of 2024.

Henry Soesanto, Chief Executive Officer, commented, “During the second quarter APAC BFB saw modest topline growth and continued expansion of gross margin and core net income on a year[1]on-year basis. Our APAC BFB gross margins have substantially rebounded from last year’s levels, and while we believe further sequential gains will be limited, we expect to see continued improvement in Q3 on a year-on-year basis. For our Meat Alternative business, we saw some gradual improvement in gross margin which we expect will be maintained and improved upon as the year progresses as our focus remains on optimizing costs and looking for efficiencies with the goal of maintaining EBITDA neutral or better for the year.”

Monde Nissin Corporation is a global food and beverages company headquartered in the Philippines, with a portfolio of iconic and market leading brands across fast-growing categories, including Lucky Me! noodles, SkyFlakes crackers, Fita crackers, Monde baked goods and Quorn meat alternative products. The Company aspires to improve the well-being of people and the planet, and create sustainable solutions for food security. That aspiration is reflected in our commitment to continuously improve our products to make them more delicious, nutritious, and better for the planet.

Quorn Foods is a global market leader in healthy, sustainable protein. Headquartered in Stokesley, North Yorkshire in the United Kingdom, the company offers a wide range of great-tasting products to appeal to the rapidly expanding group of people wanting to reduce their meat consumption. The company employs around 900 people and exports to 15 countries around the world, including Australia, Singapore and the United States. Quorn® is one of the United Kingdom’s top 40 FMCG brands. Quorn Foods is the reporting group which includes a main trading company, Marlow Foods Ltd. Quorn Foods encompasses all international operations of Quorn® and Cauldron®.