Food Empire - Maybank Research 2024-08-14: Facing Headwinds; Downgrade To HOLD

• Food Empire (SGX:F03)'s 1H24 revenue rose 13.6% y-o-y to US$225.2m, but PATMI declined by 12.8% y-o-y to US$23.2m, less than we expected, mainly due to short-term price disruption in Russia and higher raw material prices.
• - Read this at SGinvestors.io -

Better wait for headwinds to clear

• Food Empire’s business model has proven resilient and we are confident in management’s execution ability. As a result, we prefer to wait for short-term headwinds to clear and downgrade Food Empire to HOLD.

Higher coffee bean prices and inventory hurt margins

• As expected, higher coffee bean prices reduced Food Empire's 1H24 margins. Meanwhile, customers’ high inventory levels caused price disruptions across the country and there were more promotions to clear stock. As a result, Food Empire has to offer customers discounts, which may further impact margins.
• - Read this at SGinvestors.io -

Special dividends likely to be cut

• Read more at SGinvestors.io.

Above is an excerpt from a report by Maybank Research.
Clients of Maybank Securities may be the first to access the full PDF report @ https://www.maybanktrade.com.sg/.

Read also Maybank's most recent report:
2025-02-27 Food Empire - Back To Growth, Upgrade To BUY.

Previous report by Maybank:
2024-11-13 Food Empire - Revenue Growth On Track.

Price targets by 2 other brokers at Food Empire Target Prices.

Listing of research reports at Food Empire Analyst Reports.

Relevant links:
Food Empire Share Price History,
Food Empire Announcements,
Food Empire Dividend Payout Dates & Corporate Actions,
Food Empire News