Food and beverage company Yeo&rsquo s has announced the resignation of current group CEO Samuel Koh, which will take effect on Dec 31.

 

In a release, Yeo&rsquo s said Koh resigned to pursue other interests, and will take on the role of a consultant to the company from Jan 1 to June 3, 2023 to ensure an orderly transition. The date could be earlier, if mutually agreed.

 

Yeo&rsquo s will promote current COO Ong Yuh Hwang to succeed Koh as CEO from Jan 1 2023, while current deputy CFO Daphne Heng will assume the role of CFO on Dec 9.

 

Yeo&rsquo s chairman Daryl Ng thanked Koh for his service over the past three years, and also expressed confidence in Ong and Heng.

 

&ldquo Both of them possess considerable expertise and experience, and more importantly, will inject fresh energy and perspective to chart the next stage of Yeo&rsquo s growth plans as regional economies recover from the pandemic,&rdquo Ng said.

 

Before joining Yeo&rsquo s as COO in September 2022, Ong served as CEO of Suntory Garuda Beverage Indonesia for over two years, and before that, was at Procter and Gamble from 1996 to 2020.

 

Heng joined Yeo&rsquo s in July 2020 and was formerly from Jardine Matheson. Before that, she had spent three years with Haier Group.

 

Ong will be responsible for the overall management, operations and performance of Yeo&rsquo s, while Heng will be responsible for the finance functions of the company.

Instead of making a profit of $1.2 million for the 1HFY2022 ended June 30, Mainboard-listed Yeo Hiap Seng would have made a net loss for the six-month period.

 

Based on the group&rsquo s initial guidance, Yeo Hiap Seng would have expected to see a net profit for the 1HFY2022, reversing from the previous year&rsquo s net loss. The performance growth was mainly attributed to the group&rsquo s better performances in Malaysia and Cambodia.

 

On Oct 19, the group said that there had been an understatement in the net loss of its Malaysian subsidiary, Yeo Hiap Seng (Malaysia) due to &ldquo certain accounting errors on consolidation adjustments&rdquo in the group&rsquo s Malaysian subsidiary.

 

&ldquo There had been an understatement in the net loss in the consolidated financial statements of Yeo Hiap Seng (Malaysia) of $2.1 million for the FY2021 ended Dec 31, 2021 (FY2021 misstatement), and $1.8 million for the 1HFY2022 ended June (1HFY2022 misstatement),&rdquo says the group via a bourse filling.

 

Had the accounting errors been known at the time of the unaudited results for the six-month period, the group would have seen a net loss of $0.6 million instead of a net profit of $1.2 million if the 1HFY2022 misstatement had been adjusted for.

 

Had both misstatements been adjusted for, Yeo Hiap Seng would have registered a net loss of $2.7 million instead.

 

According to the group, the misstatements have no significant impact on the group&rsquo s net asset position and operating cash flows for the period ended June 30. The misstatements will be adjusted in the group&rsquo s FY2022 financial statements ending Dec 31.

 

The misstatements were said to be the result of human error. The board adds that they &ldquo are not aware of any fraud&rdquo .

 

BEVERAGE company Yeo Hiap Seng is expecting to report a net profit for the half year ended Jun 30, 2022, as compared with a net loss posted in the same period the year before, the board said in a profit guidance on Friday (Aug 5).

 

The expected net profit for H1 2022 is mainly attributed to the performance improvement in Malaysia and Cambodia, it said in the bourse filing.

 

The group previously posted a net loss of S$1.2 million for the half year ended June 30, 2021, narrowing from the S$6.7 million loss reported in the first half of 2020.

 

Its financial results for H1 2022 will be announced by Aug 12, 2022.

 

BEVERAGE manufacturer Yeo Hiap Seng : Y03 -0.6% (Yeo&rsquo s) on Thursday (May 19) announced that its chief finance officer Chan Ying Jian, as well as its Malaysia, Indonesia and Brunei chief executive officer Jerson Go Uy have tendered their resignations.

 

Chan, who joined Yeo&rsquo s in July last year, will leave the company on Aug 10. The mainboard-listed company said in a bourse filing that he will be leaving to pursue other career opportunities, and more details on his replacement will be provided soon.

 

Uy, who joined Yeo&rsquo s 2 years ago, will resign from his post on July 31 to pursue other opportunities.

 

Chan was previously at private education chain The Learning Lab, where he served as CFO and information technology director. Prior to that, he was group CFO, as well as chief investment officer and group head of information technology, at BreadTalk.

BEVERAGE manufacturer Yeo Hiap Seng (Yeo' s) announced Tuesday (Apr 5) that it has retrenched 32 employees in Singapore under its long-term plan to transform its global business.

 

In a bourse filing, the heritage brand said it is changing its business model in Singapore due to changing consumer patterns and retail conditions as well as increasing cost pressures.

 

" This was a very difficult decision for us to make. The changing market conditions and cost inflation meant that the group has had to evolve our business service model to be more efficient," said Yeo' s Group chief executive Samuel Koh.

 

" Yeo' s has a global footprint and this decision is consistent with our long-term strategic plan to transform and enhance the value of our business," he added.

 

The company said the change in business model and retrenchment exercise in Singapore will reduce the group' s on-going operating costs.

 

It noted that the affected workers represent less than 2 per cent of its total workforce of 1,900.

 

The group expects to incur a one-off restructuring charge, with separation packages to be given to the retrenched staff to help them through the transition.

 

The quantum of this restructuring charge will be finalised later, it said.

 

Yeo' s added that it is working with the Food, Drinks and Allied Workers Union (FDAWU) and the National Trades Union Congress' (NTUC) Employment and Employability Institute (e2i) to extend training and placement support and career guidance to those affected.

 

" At Yeo' s, we have always valued our people and we are committed to providing the necessary support to help all our affected colleagues," Koh said.

 

BEVERAGE maker Yeo Hiap Seng (YHS) posted a net loss of S$1.21 million for the six months ended June 30, narrowing from the S$6.73 million loss reported in the year-ago period.

 

The heritage brand attributed the improvements to double-digit growth in its core food and beverage revenue, and " positive momentum from key overseas markets" .

 

However, it acknowledged that the operating environment for its home markets of Singapore and Malaysia, as well as the neighbouring region, remains uncertain due to new waves of Covid-19 infections.

 

Group revenue for H1 2021 grew 4.2 per cent to S$169.3 million, of which core F& B revenue rose 14.4 per cent to S$153.8 million year-on-year.

 

Across key markets, growth momentum was strongest in Malaysia, China, and Hong Kong, with revenue from these regions rising 21 per cent year-on-year.

 

" This is especially encouraging given Malaysia' s position as one of our home markets and major revenue contributor to the group, while China (includes mainland China and Hong Kong) is one of our focus markets driving our next phase of growth," YHS said in a bourse filing after trading hours on Tuesday.

 

It also highlighted double-digit growth in Vietnam, albeit coming off of a lower base due to it being a newer market.

 

The group remains " cautiously optimistic" about momentum from higher-growth markets, while noting the challenges it faces with ongoing movement restrictions.

 

" Governmental measures such as the capacity limitations on dining-in at F& B establishments, various degrees of lockdowns and movement controls not only might impact the demand on Yeo' s products, but might pose supply chain and production challenges, as the group has significant production operations in Malaysia.

 

" The group also potentially faces labour shortages at our production facilities from time to time as governmental measures, which evolve with the pandemic situation, restrict workers' movement," it noted.

 

YHS' S$30 million joint investment with Swedish oat milk company Oatly, in equipment and facility to produce the oat beverage for Asia, has started commercial production in July, YHS said in its Tuesday filing. YHS is Oatly' s first Asia supplier.

 

As at June 30, 2021, YHS has cash and cash equivalents of S$251.1 million and no bank borrowings.

SWEDEN' S Oatly and Singapore' s food and beverage (F& B) manufacturer Yeo Hiap Seng (Yeo' s) will jointly invest S$30 million in equipment and facility to produce the vegan milk producer' s popular oat drink in Singapore, in what is seen as a coup for the Singapore heritage brand and the nation as a high-tech manufacturing hub.

 

Oatly - which raised US$200 million in July 2020 from celebrities including Oprah Winfrey, Jay Z, Natalie Portman as well as high profile investors like former Starbucks chairman and CEO Howard Schultz and private equity firm Blackstone - has chosen Yeo' s as its first Asia supplier and its Senoko Way factory in Singapore as its manufacturing location after strict due diligence.

 

This will be the first time the Swedish company will be producing its popular oat milk brand, Oatly, outside Europe and North America.

 

Yeo' s - which has pioneered innovations in Asian beverages and boasts of being the first in the world to package Asian drinks in Tetra Brik aseptic cartons using ultra-high heat temperature (UHT) process - will operate and maintain the new facilities.

 

Production will begin in the second half of this year, with the oat milk earmarked for China and subsequently for the rest of Asia.

 

" This strategic partnership is a testament to Yeo' s unwavering commitment to manufacturing standards and high standing in the food and beverage industry in Asia," Yeo' s Group chief executive officer Samuel Koh told The Business Times.

 

The Singapore facility will produce 60 million litres of oat milk a year at launch, and has the option to scale up further with additional investment. The oats will be sourced from Sweden.

 

Johnny Teo, executive director for food, healthcare and biomedical at Enterprise Singapore, said: " This collaboration between Yeo' s and Oatly is an example of a strategic cross-border partnership that capitalises on complementary capabilities among different players in the food ecosystem, which we hope to see more in Singapore.

 

" We are also heartened by Yeo' s efforts to constantly innovate and sharpen its competitive edge as a Singapore beverage manufacturer, and are glad to have been part of its journey in attaining this significant milestone."

 

The partnership will initially create more than 50 new jobs at Yeo' s, and the investment will be funded from internal reserves.

 

It will be value-accretive to Yeo' s business by providing it with another growth driver in the fast-growing plant-based milk alternative segment, Mr Koh said.

 

The partnership will complement Yeo' s leading position in the soy milk segment and corporate mission to " nourish every home with natural goodness across generations" .

 

" This strategic partnership positions both companies to tap the surging demand in this region for plant-based dairy," Mr Koh said.

 

" We believe that this segment will continue to grow exponentially as consumers become more aware of the impact of their food and beverage choices on their health and the environment."

 

Demand for dairy milk alternatives has been gaining traction globally, and oat milk is the latest trendy plant-based milk joining the ranks of almond, rice, and soy to take over supermarket shelves, café s, and coffee shops, as consumers seek healthier beverages with environmental credentials.

 

Research and Markets, a Dublin-based market research company, expects the global oat milk market to grow at a 13.4 per cent compound annual growth rate from 2020 to reach US$6.8 billion by 2026. Asia is the largest market for dairy alternatives and the fastest growing region, according to Mordor Intelligence.

 

Yeo' s will deploy state-of-the-art Tetra Pak packaging technology incorporating high speed aseptic filling, flexible packaging and stringent food safety standards that are in line with the US Food and Drug Administration (FDA) standards. Working with Tetra Pak, one of the world' s leading and most sustainable packaging companies, will cement Yeo' s status as a high-tech and sustainable food and beverage manufacturer in the years to come, the company said.

 

Mr Koh said the demand for healthier and more sustainable choices has seen its core soy milk and chrysanthemum teas business growing in the second half of last year despite the impact of the Covid-19 pandemic.

 

Earlier in March, Oatly - which is looking to list in the United States to fund its expansion - unveiled plans for a major plant-based dairy factory, to be based in Peterborough, England. The new factory will produce 300 million litres of oat milk a year, and has the capacity to grow to 450 million litres, making it one of the largest plant-based dairy factories in the world when it is launched in the first quarter of 2023.

 

Oatly - whose biggest shareholder is Belgian family-owned investment firm Verlinvest - was founded by brothers Rickard and Bjö rn Ö ste in the 1990s. It uses patented enzyme technology, invented by Mr Rickard Ö ste when he was a food scientist at Sweden' s Lund University, to turn fibre-rich oats into lactose-free products such as oat milk, oatgurt and ice cream.

 

Besides Verlinvest, China Resources Group was also among the earliest backers of the company, whose products are sold across Europe, the US and Asia. Oatly' s sales almost doubled to US$200 million in 2019, aided by new products including ice-cream and yoghurt. Oatly was aiming to double sales again in 2020, but no official figures have been made public.

 

According to some estimates, the Swedish company, whose Oatly brand is available in more than 20 countries, could be valued at US$10 billion - more than the US$2 billion suggested in the investment round in July 2020. It has hired Morgan Stanley, JP Morgan and Credit Suisse as underwriters on the initial public offer.

A YEAR after becoming the group chief executive officer (CEO) of Yeo Hiap Seng Group (Yeo' s), Samuel Koh has crafted a clear strategy and roadmap to take the Singapore heritage brand to its next growth stage, with an expanded product offering.

 

With health and wellness being top of mind for many during the Covid-19 pandemic, Mr Koh, 46, wants to propel Yeo' s - whose history dates back to 1900 as a soy sauce factory in China - to become the Asian company that offers innovative and healthy food and beverage (F& B) products to consumers, including the millennials.

 

" We will focus on our core F& B business, especially in innovating and growing the tea and plant-based dairy categories where we already have a healthy position through our soy and chrysanthemum tea products. We will focus on delivering innovative and great tasting products that promote health and wellness," said Mr Koh in an interview with The Business Times.

 

The trusted household name, which has been listed since 1969, has elevated its iconic Yeo' s Chrysanthemum Tea to a healthier level that resonates with health-conscious consumers, launching newer varieties that include no sugar, reduced sugar and wholesome ingredients such as honey and wolfberry.

 

Apart from growing its core, the group is looking to expand overseas.

 

" Besides our home markets of Malaysia and Singapore, where we have a long history and established market presence, we will also accelerate our growth in the larger consumer markets of China and Indochina," said Mr Koh.

 

In what is seen as a coup for the Singapore company, as well as for Singapore as a high-tech manufacturing hub, Yeo' s has teamed up with Sweden' s Oatly - arguably the world' s most popular and fast-growing oat-based drinks company - to be its first supply partner outside Europe. The tie-up will see Yeo' s producing Oatly oat drink products from its Singapore manufacturing facility at Senoko Way and supplying to Oatly' s markets across Asia in 2021.

 

" This strategic partnership will be value-accretive to our business by providing Yeo' s with another growth driver in the fast-growing plant-based milk-alternative segment, and it complements our leading position in the soy milk segment," Mr Koh said.

 

The group continues to seek strategic partnerships to optimise its portfolio and drive productivity.

 

" We are in the early innings of Yeo' s transformation journey. We are very open minded and keen to work with strategic partners or make a merger and acquisition (M& A) play," he added.

 

For 2021, Yeo' s will focus on its strategic partnership with Oatly, while remaining active in looking for inorganic growth opportunities.

 

With the increasing global focus, Mr Koh has brought on board " diverse, hungry and experienced world-class talents" into various levels of Yeo' s organisation. Today, most of Yeo' s leadership team members were either born overseas or have lived and worked abroad.

 

" This is critical, as increasingly, our growth will come from overseas. Culture is a big piece of our transformation. Hence, my leadership team and I have stepped up our communication and engagement and have been rolling out programmes to support the cultural change," he said.

 

Yeo' s - now one of the publicly-listed arms of Far East Organisation after the Yeo clan lost control of the company to property magnate Ng Teng Fong in 1994 - has a strong balance sheet with cash and cash equivalents of S$264.2 million and no borrowings as of Dec 31, 2020.

 

" As such, we are well placed financially to fund these strategic goals," Mr Koh said.

 

In addition to F& B, Yeo' s has a portfolio of properties including offices and warehouses in Singapore, China and Malaysia, as well as farming land in Malaysia.

 

Asked about development plans, Mr Koh said there may be opportunities in its property portfolio but - for now at least - real estate does not drive his agenda. Instead, the F& B industry veteran sees tremendous upside value in Yeo' s core F& B business and is relentlessly focussed on innovating and growing this core business.

 

Mr Koh joined Yeo' s on Jan 14, 2020, as Group CEO (Designate) before being formally appointed to the role on March 14, 2020. He is not new to the F& B sector, as he was previously vice-president of The Coca-Cola Company' s Greater China, Korea and Mongolia business unit, where he led the setting up of new business ventures and made strategic investments in other emerging F& B players. Prior to that, he held various roles in strategy, business development and finance in Coca-Cola (including its Asean Business unit) Yum! Brands and Unilever.

 

While the headwinds from the Covid-19 have slowed Yeo' s down to some extent, the group remains " firmly on track to grow and transform" , he said.

 

For the full year ended Dec 31, 2020, Yeo' s sank into the red with a net loss of S$10 million, compared to a net profit of S$17.7 million in 2019. However, compared to the first half of 2020, Yeo' s net loss in the second half of 2020 was considerably lower. Its core F& B sales for the second half were in line with the second half of FY2019, despite Covid-19 in 2020.

 

For FY2020, Yeo' s generated cash of S$8.3 million from operating activities. Cash and cash equivalent stood at S$264.2 million at the end of December 2020. Cash outflow was deployed primarily to pay shareholder dividends and to fund capital expenditure for its strategic partnership with Oatly.

 

The group doubled its e-commerce sales, achieved double-digit growth in its China sales for the second consecutive year as well as delivered double-digit growth in its food business.

 

Mr Koh added that Yeo' s has maintained its Asian drinks market share leadership in Malaysia and Singapore, and gained market share in Malaysia after declines over the past two years.

 

" In a nutshell, topline growth in Yeo' s F& B, which enjoyed a higher profit margin, productivity programme and strategic partnership, will help improve our 2021 earnings before interest and tax (EBIT)," he said.

 

As for concerns over rising prices of raw materials, Mr Koh said Yeo' s has initiated several programmes to mitigate this. These include working with suppliers to forward-buy some key raw materials and optimise prices optimising margins in different channels and improving product/packaging design, material sourcing and manufacturing processes.

 

If the pandemic were to drag on, Mr Koh reckoned what is key is that Yeo' s " stay agile, innovative and entrepreneurial to accelerate growth, drive transformation and execute well" .

 

" Importantly, balance sheet-wise, we are in a robust position to navigate through the storm," he said.

 

Based on information as at March 6, 2020, about 21.34 per cent of the issued ordinary shares of Yeo' s are in public hands. The stock was last trading at around S$0.785.

BEVERAGE player Yeo Hiap Seng (YHS) recorded a S$3.3 million loss for H2 ended December, as sales took a hit from the impact of Covid-19. This reversed the S$3.1 million net profit from a year ago.

 

Nevertheless, the firm has recommended a final dividend of S$0.02 per share for FY2020, with the option to receive the dividend in scrip.

 

Revenue for H2 fell 7.5 per cent to S$159.4 million, while that for the full year dropped 10.3 per cent to S$321.9 million. Overall, YHS had a loss of S$10 million for FY2020, in contrast to a S$17.7 million net profit the previous year.

 

YHS said that its sales had slowed down due to channel shifts, softer consumer spending as well as lower agency sales. The full-year bottom line was also hit by the absence of one-off gains on asset disposals and fair value gains on financial assets, totalling S$14.8 million, alongside fair value gains on investment properties of S$2.3 million. Higher impairment of trade receivables was another factor.

 

YHS chief executive Samuel Koh said: " While Covid-19 will continue to pose uncertainty and pressure on our business, we are encouraged to see traction with the strategies which we have put in place.

 

" In FY2020, we doubled our e-commerce sales, achieved double-digit sales growth in our mainland China business for the second consecutive year and delivered double-digit sales growth in our food business."

 

The firm will focus on growing its core its food and beverage portfolio through adapting commercial strategies, new product innovation, strengthening its supply chain and driving productivity.

 

YHS has cash and cash equivalents of S$264.2 million as at end-2020 and no bank borrowings. It recognised Covid-19 relief of S$4.5 million during the year.

 

BEVERAGE player Yeo Hiap Seng' s wholly-owned indirect subsidiary in Malaysia has been served with three writs of summons from former distributors for about RM13.7 million (S$4.5 million) in total claims.

 

The writs were filed in the High Court of Malaya at Shah Alam by Sengjaya Gains, Sengjaya Marketing and Sengjaya Gains (KL). Each of their non-exclusive agreements had been terminated, Yeo Hiap Seng said in a bourse filing on Monday night.

 

The plaintiffs are seeking declaratory reliefs on the termination of their respective agreements, refunds of the security deposits paid and for general, special, exemplary and aggravated damages.

 

The subsidiary - Yeo Hiap Seng Trading Sdn Bhd (YHS Trading) - disputes the actions and has appointed solicitors to enter appearance to vigorously defend the actions on the advice that the basis for the actions is wholly groundless and without any merit whatsoever.

 

YHS Trading has similarly taken advice for the recovery of the sums owed by the former distributors, arising from the latter' s alleged breaches of their respective agreements.

 

Yeo Hiap Seng said the actions are not expected to have any material impact on the group' s sales, although the recovery of sums owed by the former distributors may be impaired for the financial year ending Dec 31, 2020.

 

It said it is assessing the situation and will make further announcements as appropriate on any material developments.