SINGAPORE: Singaporeans love food, and the food and beverage sector offers tasty investment opportunities.
According to The Smart Investor, these four food-related Singapore stocks will add flavour to your portfolio and serve delicious returns.
1. Jumbo Group
Jumbo Group is a familiar name in the local food scene, known for its brands like Jumbo Seafood and Ng Ah Sio Bak Kut Teh, operating 46 outlets across 14 Asian cities.
For the first half of fiscal 2024 (1H FY2024) ending Mar 31, 2024, the group’s revenue rose 13% year-on-year (YoY) to S$97.1 million.
This boost was mainly due to higher business volumes in Singapore, spurred by a rebound in tourism and a S$0.3 million franchise fee from new outlets.
Gross profit climbed 13.3% to S$64.4 million, while net profit increased 11.9% to S$8.9 million. Although free cash flow was S$10.5 million, it was lower than the S$14.6 million from the previous year.
Notably, the group declared an interim dividend of S$0.005 compared to none declared the year before.
Despite challenges in China, the group continues to expand in Singapore, reopening Jumbo Seafood at The Riverwalk and launching a new Ng Ah Sio outlet at The Central.
2. Old Chang Kee
Old Chang Kee (OCK) is another beloved local brand known for its curry puffs and spring rolls sold through kiosks and retail outlets.
For fiscal 2024 (FY2024) ending March 31, 2024, OCK’s revenue grew 12.4% YoY to S$100.9 million, with gross profit up 17.1% to S$68.2 million. OCK’s net profit also surged 57.2% to S$9.7 million.
The company also has a strong balance sheet with S$44.1 million in cash and S$2.9 million in debt. The business generated S$25 million in free cash flow, up from S$21 million in FY2023.
The company’s total dividend for FY2024 was S$0.02 per share, giving a trailing yield of 2.7%.
Management aims to counter inflation by reducing costs and expanding outlets in strategic high-traffic locations.
3. Food Empire Holdings
Food Empire is known for its instant beverages and snack foods, with products sold in over 60 countries. The group reported a revenue of US$425.7 million for 2023, up 6.9% YoY.
Operating profit rose 34.6% to US$70.9 million, and core net profit increased 25.3% to US$56.5 million.
Food Empire declared a dividend of S$0.10, more than double the S$0.044 in 2022.
For the first quarter of 2024 (1Q 2024), revenue grew 14.5% YoY to US$117.5 million.
The company made strategic changes in Vietnam and launched new marketing strategies expected to sustain growth. The group also expanded its non-dairy creamer facility in Malaysia and is building a new snack factory.
In addition, Food Empire plans to invest US$30 million in a production facility in Kazakhstan, set to be operational by the end of 2025.
4. Fraser & Neave
Fraser & Neave (F&N) is a giant in the F&B industry, known for beverages like 100Plus and F&N sparkling drinks. For 1H FY2024, F&N’s revenue increased 2.5% YoY to S$1.1 billion, with net profit soaring 52.5% to S$83.8 million.
F&N declared an interim dividend of S$0.015.
The group secured a land lease for a new dairy manufacturing facility in Cambodia, set to be ready by early 2026. New product launches in 1H FY2024 included Fruit Tree Muscat Grape Juice and F&N Magnolia Cookies and Cream. /TISG
Read also: 4 SG stocks to keep your eyes on this July
Disclaimer: This article is for educational purposes only. It should not be considered Financial or Legal Advice. Investors should conduct their due diligence before making major financial decisions
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