Tingyi's H1 net up 24% on falling costs
Source: Bloomberg News |
August 21, 2012, Tuesday
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Print Edition
Print Edition
TINGYI (Cayman Islands) Holding Corp, the maker of "Master Kong" instant noodles and beverages, reported a 24 percent jump in first-half profit on falling raw material costs.
Net income rose to US$284.4 million in the six months ended in June from US$229 million a year earlier, the company said in a statement to the Hong Kong stock exchange yesterday. That beat the US$275.8 million average of five analyst estimates compiled by Bloomberg News. Revenue rose 9.5 percent to US$4.53 billion.
Tingyi is using its 57 percent of the Chinese instant noodle market to capture rising consumer demand for premium foods with higher profit margins, according to analysts at BOCOM International Holdings Co. The foodmaker announced last November a tie-up with PepsiCo Inc under which a Tingyi unit became the franchise bottler of its drinks in China.
"Riding on its massive distribution complex, extensive food and beverage collection and expansive capacity, Tingyi should continue to shine," said Summer Wang, a Hong Kong-based analyst at BOCOM, ahead of the earnings announcement.
The beverage alliance may boost PepsiCo's market share in China where the New York-based company was the fourth-largest soft-drink maker with 4.9 percent share last year. Coca-Cola and Tingyi led the China soft drink market with 15.8 percent and 13.1 percent share in 2011, respectively, data from London-based researcher Euromonitor International show.
Under the deal, PepsiCo will transfer equity interests in its bottling operations in China to Tingyi beverage subsidiary Tingyi-Asahi Beverages Holding Co. In exchange PepsiCo will get 5 percent in Tingyi-Asahi, with an option to raise that to 20 percent by October 2015.
Net income rose to US$284.4 million in the six months ended in June from US$229 million a year earlier, the company said in a statement to the Hong Kong stock exchange yesterday. That beat the US$275.8 million average of five analyst estimates compiled by Bloomberg News. Revenue rose 9.5 percent to US$4.53 billion.
Tingyi is using its 57 percent of the Chinese instant noodle market to capture rising consumer demand for premium foods with higher profit margins, according to analysts at BOCOM International Holdings Co. The foodmaker announced last November a tie-up with PepsiCo Inc under which a Tingyi unit became the franchise bottler of its drinks in China.
"Riding on its massive distribution complex, extensive food and beverage collection and expansive capacity, Tingyi should continue to shine," said Summer Wang, a Hong Kong-based analyst at BOCOM, ahead of the earnings announcement.
The beverage alliance may boost PepsiCo's market share in China where the New York-based company was the fourth-largest soft-drink maker with 4.9 percent share last year. Coca-Cola and Tingyi led the China soft drink market with 15.8 percent and 13.1 percent share in 2011, respectively, data from London-based researcher Euromonitor International show.
Under the deal, PepsiCo will transfer equity interests in its bottling operations in China to Tingyi beverage subsidiary Tingyi-Asahi Beverages Holding Co. In exchange PepsiCo will get 5 percent in Tingyi-Asahi, with an option to raise that to 20 percent by October 2015.
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