PETALING JAYA: Guan Chong Bhd (GCB), the world’s fourth-largest cocoa grinder, achieved record-high revenue of RM5.3 billion for the financial year ended Dec 31, 2023 (FY23), an increase of 21% compared with RM4.4 billion in the previous financial year.
The record revenue was in line with the rising cocoa bean prices, and contribution from its Ivory Coast operations for the full year.
However, GCB”s net profit for FY23 decreased 31.4% to RM101 million from RM147.4 million previously, mainly due to increased finance costs from higher borrowings, lower grinding margins, and increased tax expenses.
Managing director and CEO Brandon Tay Hoe Lian said, “The strong revenue in FY2023 underscores the enduring demand for our cocoa ingredients among our clientele, despite the ever-rising selling prices.
“Besides that, our grinding operation in Ivory Coast continues to see meaningful contributions to our profits, enabling us to benefit from the lower logistical costs of operating within proximity to the source of quality cocoa beans. The cocoa ingredients produced there will support our two industrial chocolate operations in Europe, where the demand for chocolate is greater.”
Looking ahead, he said GCB will remain vigilant and observe market conditions to ensure their operations globally are well-maintained, while they strive to optimise production to meet customers’ demand.
In the fourth quarter ended Dec 31, 2023 (Q4’23), the group posted 59.2% higher revenue of RM1.8 billion, from RM1.1 billion in the same period last year, attributed to higher selling prices of cocoa butter, cocoa solids, and industrial chocolate due to increasing cocoa bean prices.
However, net profit in Q4’23 decreased 18.8% to RM15.3 million from RM18.8 million previously, mainly due to increased finance costs from higher borrowings and tax expenses.
Tay said, “Our working capital requirements have increased in tandem with the higher cocoa bean prices. Therefore, most of our borrowings now are dedicated to supporting our operations and purchasing cocoa beans. The Group is aware of the current situation in the chocolate industry and is taking measures to control the impact and stabilise our operations.”
Established in 1990, GCB is one of the largest cocoa processors in the region, with total annual grinding capacity of 330,000 tonnes per year. GCB is among the top 4 cocoa ingredients producers in the world.
