Thai Union Frozen Products PCL. (TUF), Thailand’s leading producer and exporter of canned and frozen seafood products, says that the promising outlook on its tuna and shrimp business has remained unharmed from the persisting problems over tuna and shrimp raw materials. At present, sufficient raw materials are procured and supplied to TUF plants without interruption. TUF remains confident in its current business strengths to achieve revenues and sales growth targets over 30% for 2011 operations.
As revealed by Thiraphong Chansiri, TUF’s president, there are a number of recent factors that have raised concerns among investors and shareholders over potential adverse impacts on the Company’s shrimp and tuna raw materials. The concerns are triggered by the widespread damages to shrimp farming areas in southern Thailand following floods and landslides, the earthquake and tsunami calamity in Japan, and the subsequent detection of radioactive material leakage into Pacific Ocean along Japanese coastal waters, one of the world’s major tuna fishing grounds. Nevertheless, the crisis has had no adverse impacts on TUF business operations and its raw material procurement. Furthermore, TUF remains confident that it will be able to meet revenues and sales growth targets for 2011.
For shrimp business, TUF has to date remained unharmed both in terms of sales volume and flow of raw material supply despite damages to shrimp farming areas following the recent floods in southern Thailand. Sufficient shrimp supply has still been delivered to TUF processing plants as usual and uninterrupted from sources in eastern and upper southern coastal areas and raw material price has not changed from the previous time. Meanwhile, the two processing plants in Samutsakorn and Songkhla provinces are still working at full capacity in order to meet unmet strong market demand.
With regards to tuna business, there have recently been concerns for radioactive contamination in tuna supply from Japan’s Pacific Ocean coasts as a result of the radiation leaks from its crippled nuclear power plants. In response to such concerns, TUF has discontinued its tuna procurement from the affected areas and currently turned to other non-Japan fishing grounds in Western Pacific Ocean and Indian Ocean instead. In addition, TUF requires that each lot of delivered tuna supply be sent to Thailand Institute of Nuclear Technology (TINT) for thorough inspection for potential radioactive contamination in order to ensure total consumer confidence.
As anticipated earlier, TUF reports strong sales growth during its first-quarter operations. The achievement provides TUF a reasonable ground for confidence in potentially more robust operating performance for the quarter when compared to Q4/2010 counterpart.
Source: TUF website