Farsons Group Chairman Louis A. Farrugia has stated that the group’s outlook for the remainder of the current financial year remains “cautious” but also “optimistic”.
This comes after Simonds Farsons Cisk plc on Wednesday released Farsons Group’s interim results for the six months ending 31st July 2023. During this period, it registered €65.2 million in turnover, an increase of 13.8 per cent from the €57.3 million recorded in the same period last year. Pre-tax profit amounted to €8.1 million, up by 3.8 per cent from the corresponding period in 2022. Farsons Group’s trading performance was characterised by a “notably strong demand” for its products, in part reflecting the recovery trajectory of the tourism sector, the group said.
However, it also sustained margin compression resulting from a combination of the impact of higher input costs, a continuing tightness in the labour market with an accompanying wage inflation, as well as cost of living pressures on household budgets. Earnings per share attributable to shareholders improved by seven per cent from €0.195c in the first half of financial year 2023 to €0.209c for the current six-month period.
On the investment front, Farsons Group celebrated a “significant milestone” in June 2023 with the inauguration of the restored former Farsons Old Brewhouse, where all the food and beverage outlets are now open to business and are generating “increasing patronage”. Farsons Group is now shifting its attention to other growth avenues such as enhancing its logistical capacities to meet the growing demands of its beverages sector.
Additionally, the group also embarked on the planning process for a significant investment in the foods sector to develop warehousing facilities, offices, and a state-of-the-art logistics centre at a site in Qormi that already forms part of the group’s portfolio. Farsons Group stated that this infrastructure will play a “pivotal role” in enabling the segment to “efficiently expand” its existing portfolio and meet the growing demand of its operations.
As he heralded the group’s “commitment to future investments”, Mr Farrugia added that the Board of Directors, together with the management team, “remains focused on enhancing its adaptability and agility in responding to the current market and economic challenges as it vies for further growth”.
“Following the results achieved in the six months under review, our outlook remains cautious yet optimistic for the remainder of the current financial year,” he said.
He continued by adding that following the group’s “sustained overall performance”, the Board of Directors has resolved to declare an interim dividend of €0.05 per ordinary share, equivalent to €1.8 million, when compared to the previous year’s interim dividend of €0.045. Shareholders who hold ordinary shares as of the close of business on 4th October 2023 will be eligible to receive this dividend, and the distribution of the dividend is scheduled for 18th October 2023.
Commenting on Farsons Group’s performance, CEO Norman Aquilina said that management has been “focusing intensely” on cost containment by improving operational efficiencies across various sectors and “averting passing on all increases to the consumer”.
“We have also been responding proactively to shifting market demands by anticipating and aligning with changing consumer preferences,” he remarked.
“Margin compression is expected to remain a challenge and a market reality during the rest of the financial year and beyond, but we are actively engaged in the goal of restoring our margins,” Mr Aquilina concluded.
Farsons Group Chairman Louis A. Farrugia
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