Tingyi returns to profit as China economy steadies
The 19.4 percent rise for Tingyi (Cayman Islands) Holding Corp's third-quarter net profit was a turnaround from a profit decline in the second quarter, and was also due to greater production efficiency at bottling plants that it operates under a broad partnership with PepsiCo Inc.
Tingyi, which commands just over half of China's $8.8 billion instant noodle market, has also been able to weather the country's economic slowdown better than rivals, thanks to its leading positions in both drinks and noodles, taking advantage of greater economies of scale.
The company, which sells noodles under the Master Kong brand, said on Monday that net profit for the three months ended in September totalled $155.9 million, although that fell a little short of an average forecast of $162 million from six analysts polled by Reuters.
Tingyi's Chairman, Wei Ing-Chou, said in a statement that he expects China's economy to continue to improve after bottoming out in the third.
In view of looser fiscal and monetary policies, we expect the economic situation to improve in the fourth quarter, but to a limited extent, he said, adding the food and beverage industry was still grappling with intense competition.
Recent China data for October has provided further signs that a long slide in economic growth may be over.
DRINK REVENUE JUMPS
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