For the financial year just ended, Malaysia-based integrated poultry company Leong Hup International reports significantly higher profits, despite a dip in revenue compared with the previous 12 months.
Group pre-tax profit for the 12 months to December 31, 2024 (FY2024) was more than 760.5 million ringgit (MYR; US$170.4 million), according to the report from Leong Hup International Berhad. This represents a year-on-year increase of 37%.
In the unaudited results, the company records total revenue of close to MYR9.31 billion — down 2.4% from the figure MYR9.54 billion for the year ended December 2023. This figure comprises MYR5.4 billion from livestock and poultry products, MYR5.1 billion from animal feed production, and MYR11.5 million from other sources in FY2024.
For the fourth quarter (October-December 2024), revenue was reported at close to MYR2.32 billion, which is around 4% lower than in the same period of the previous year. However, at MYR249.2 million, pre-tax profit was MYR65.9 million higher than in the comparable period.
Contribution of operations to overall result
Citing financial analysts, Business Today reported that Leong Hup International’s strong performance during the 2024 fiscal year was driven by favorable foreign exchange movements, and lower feed costs. With a positive view on the company’s future prospects, another source highlighted its cost efficiencies, and ongoing market demand for poultry.
A combination of lower selling prices and reduced demand in some of its markets were identified as factors in a drop in revenue from the company’s feed operations, which were down by close to 21% year-on-year. This contrasts with Leong Hup International’s livestock and poultry businesses, for which revenue was reported to be 11% higher than the previous year. Growth was particularly strong in Indonesia and the Philippines, the source reports.
As well as its home market of Malaysia, Leong Hup International operates businesses in Indonesia, the Philippines, Singapore, and Vietnam.
Of the total revenue for FY2024, around 39% was generated in Indonesia, 25% in Malaysia, 20% in Vietnam, 9% on Singapore, and 8% in the Philippines.
Contributions to the overall MYR1.20 billion in Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) reported by the group in the same period were as follows: Malaysia, 42%; Indonesia, 25%; Vietnam, 17%, the Philippines, 10%, and Singapore, 5%.
By business area, MYR615.4 million of EBITDA derived from the company’s feed operations, MYR594.1 million from feed milling, and MYR5.8 million from inter-segment trade.
More on Leong Hup International
Annual production of 174 million birds puts Leong Hup International among the leading poultry meat producers in Asia, according to WATTPoultry.com’s Top Poultry Companies survey for 2023.
The group is also among the top feed manufacturers on that continent with an output of 2.67 million metric tons (mmt) in the same year, according to Feed Strategy’s Top Feed Companies database for the same year.
According to the company’s website, Leong Hup International’s main businesses are feed production, poultry breeding, broiler chicken growing, table eggs, processed foods, and food services. It has feed mills, breeders producing day-old chicks, and broiler growing in Malaysia, Indonesia, and Vietnam. Broiler chickens are also produced and distributed by the subsidiary in the Philippines, and exported from Malaysia and Singapore. A range of processed chicken, meat and seafood products are manufactured at the company’s facilities in Malaysia, Singapore, and Indonesia.
In FY2023, Leong Hup International sold 576 million day-old chicks, 174 million broiler chickens, and 1.9 billion table eggs across the group. Its feed mills have a total capacity of around 4.32mmt, and sales of close to 2.7mmt.
Following an investigation by the Malaysian competition authority in 2023, the company and four others were judged to have been members of a cartel involved in fixing poultry feed prices. In January of this year, a High Court judge called for a review of the fines imposed as a result of the original investigation.
