Food producer KIDO Group (KDC) on Friday reported a net revenue of VND3.7 trillion (US$160.18 million) for the first half of this year, jumping over 26 per cent year-on-year.

Gross profit reached VND669 billion, up by 5 per cent over the same period last year.

The company attributed the lower profit growth to the lower gross margin of the consolidated industrial Vocarimex (VOC).

The company said that its retail edible oil business had continued to pursue a strategy of premiumisation to drive both sales and profitability.

“The additional launches of new packaged products in the third and fourth quarter this year will also help drive operating efficiency of the distribution business,” the company said.

The wholesale edible oil business will leverage the solid infrastructure and scale advantage to increase sales. Gross profit will rise steadily as scale rises. Operating costs have already reduced and profitability will improve scale grows.

From operation perspectives, management would focus on tightening cost control and improving efficiency in order to increase margins, it said.

In another development, KDC’s member companies Tuong An Vegetable Oil Company (TAC) and Kido Food Company (KDF) also reported their business results in the first half.

TAC reported a revenue of VND2 trillion, up by 5.9 per cent over the first half of 2017. Profit before tax in H1 was VND45 billion. Competition in the ice cream business has affected the growth of KDF, but net revenue of ice cream still grew 1 per cent in the first half due to product premiumisation.

Revenue in the first six months reached VND704 billion, falling by 9.6 per cent year-on-year, with profit before tax of VND52 billion.

The company explained that its yogurt business had been hit by competition.

Increasing competition would drive the company to invest in both research and development and expanding its distribution network to maintain its leading position, it added. — VNS