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    Chairman’s Statement

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    Dear Shareholders,

    FY2021 was another year fraught with uncertainty and volatility. Consumer sentiment remained cautious while the world grappled with supply chain disruptions, inflationary pressures and geopolitical tensions. 

    Against this challenging backdrop, the Group is reviewing and consolidating its current businesses, and actively pursuing new business opportunities. We aim to double our top line in the next three to five years and will continue to leverage on our existing strengths such as our large stable of consumer brand assets and seek new growth engines and synergies through inorganic expansion within the Fast-Moving Consumer Goods (“FMCG”) sector.

    In FY 2021, Group revenue rose 13.1% to S$533.3 million 

    thanks to the higher sales volume achieved by our Packaging business which contributed a 21.3% jump in sales to S$367.5 million. This was offset by lower revenue from the Consumer business year-on-year.

    The Group’s FY2021 gross profit increased by 3.3% year-on-year to S$113.2 million, in line with higher revenue from the Packaging Business, partially offset by higher raw material prices.

    Due to an overall increase in operating expenses, the Group reported FY2021 net profit attributable to shareholders of S$19.6 million.

    S$113.2 million

    Group’s Gross Profit in FY2021
    as compare to S$109.6m in FY 2020

    S$29.9 million

    Group’s Net Profit in FY2021
    as compare to S$33.1m in FY 2020

    Kickstarting a New Growth Engine

    In line with this, we made an acquisition of an 80% stake in leading, reputable food distributor C.K.H. Food Trading Pte Ltd (“C.K.H.”) and 123 Mart Pte. Ltd. for a total consideration of S$3.3 million towards the end of 2021. This acquisition facilitates the extension of the Group’s distribution channels as C.K.H. supplies over 200 food products to close to 1,500 food and beverage establishments and channels in Singapore. Cross-selling opportunities aside, PSC is also able to combine resources in logistics and transportation and reap operational synergies.

    PSC has the potential to grow into a regional FMCG group and one of the key growth strategies is to broaden our consumer product range. Following months of sourcing, we have secured distribution rights for several products. In November 2021, Tipex Pte Ltd (“Tipex”) was appointed the exclusive distributor of the homegrown, award-winning Kit Cat range of wholesome and natural cat food products for supermarkets, hypermarkets, chain stores, minimarts and traditional stores in Singapore. Earlier this year, Topseller Pte Ltd (“Topseller”) began distribution for Monori seafood snacks, a popular range of snacks made from shrimp and salmon from a leading global seafood producer. Under our existing Fortune brand, we soft-launched a new range of chilled soya beancurd desserts in early 2022, which will be made available across all supermarkets, hypermarkets, minimarts and convenience stores in the second quarter of 2022.

    Our team is also working on launching a range of premium frozen seafood, which is a new product segment for the Group. With work-from-home arrangements becoming a norm, we see this as a strong and growing product segment as many consumers seek convenience and easy-to-prepare meals. Our seafood products are sourced from various reputable suppliers so as to bolster ourability to bring variety, quality and cost competitiveness to consumers. Our existing brands continued to maintain their market leadership in their respective segments through catering to shifting needs and regular brand engagements. Under Topseller, which is a strong distributor and brand developer of popular consumer essentials, Royal Umbrella launched healthier rice options in late 2020 to cater to health-conscious consumers. Our popular Beautex brand won the Top Brand Excellence Award and the People’s Choice Award in the Fairprice Excellence Awards. SOCMA, which distributes products such as confectionery, snacks, grocery items and beverages to over 20,000 distribution points in Malaysia and Brunei, was appointed as a distributor of RiceUp in July 2021, the first-ever brand of popped brown rice chips in Malaysia. Lastly, Fortune, a leading brand specialising in soya bean-based products, enjoyed strong sales growth and attained category leadership for packaged beancurd in Singapore, by being the No. 1 Tofu Brand by volume sales*.

    *Based on data reported by NielsenIQ Retail Index Service for Packaged Beancurd category from Dec ‘20-Nov ‘21, for Total Singapore (© 2021 Nielsen Consumer LLC).

     

    Unlocking Value for The Future

    Looking ahead , we are cautiously optimistic that the pandemic situation in our key markets will be well-controlled and economic activities will soon normalise. We are also closely monitoring the rising costs in raw materials and supply chain issues around the world. We will continue to harness our capabilities to scale up our business, as well as spearhead our expansion further through pursuing opportunities such as mergers and acquisitions, joint ventures and strategic alliances.

    Building on the momentum from our recent acquisition, we will identify suitable new targets in manufacturing, warehousing, logistics or food service which could bring upstream and downstream synergies and allow the Group to achieve greater scale of production and enjoy economies of scale. Companies that have strong-selling products will also be considered as they could open up new markets for the Group.

    Product innovation and new product development in line with market demand and consumer feedback will help PSC stay relevant and grow our market share in various product segments. Some of the plans in the 2022 pipeline include a rebranding of the Beautex line of products and the launch of a new range of Beautex home cleaning products; new desserts under the Fortune brand; a new range of beverages under the Sobe brand, as well as a healthier range of rice and noodles. PSC will also continue to strengthen partnerships with our suppliers and business partners to distribute or co-develop new products.

    The Group will continue to work on its longer-term plan to revive its retail business channel as it can bring benefits of new growth and income avenues, forward integration, economies of scale, reputational benefits and captive demand, as well as the possibility of new partnerships. In this regard, the Group will intensify its efforts in building its e-commerce channel as well as to seek potential inorganic growth opportunities.

    To support the Group’s growth ambitions, the Group will review its brand strategy and grow its brand assets on a continuous basis. We completed a revamp of our corporate website and will continue to work on strengthening our e-commerce capabilities alongside other digital initiatives. We will review and streamline various components of its supply chain across all segments to achieve greater economies of scale and ensure a more seamless flow of products.

    Talent is the backbone of the Group’s success and the Group will continue to invest substantially in recruiting the right people, building their capabilities, engaging and motivating them and helping them to develop a strong career path that is aligned with the Group’s goals.

    Dividend

    To thank our shareholders for their support, the Directors have proposed a final tax-exempt dividend of 0.5 Singapore cents per share, which when added to the interim dividend of 0.25 Singapore cents for the first half of FY2021, gives total dividends of 0.75 Singapore cents per ordinary share for FY2021, a 50% increase from the total dividends distributed for FY2020.

    In Appreciation

    The past financial year has been a year of renewal for PSC as a new team has been assembled to spearhead our next phase of growth. I would first like to thank all shareholders for your continued confidence in me as the Non-Executive Chairman at the last Annual General Meeting in 2021 and also for voting for leadership renewal at PSC.

    We moved quickly to strengthen the team, bringing in highly-experienced industry leaders to the Board of Directors such as NTUC Fairprice’s former Chairman, Mr Chandra Das, and former Group Chief Executive Mr Tan Kian Chiew. Mr Henry Chu, who was Chief Executive Officer of a major F&B group, also joined the PSC team as CEO shortly after. Together with my redesignation as Executive Chairman in September 2021, our team is well-equipped and ready to take PSC forward.

    I would like to take this opportunity to thank Mr Goh Yang Jun, Jasper and Mr Siu Wai Kam, who will retire from their positions as Non-Executive and Independent Directors in this coming AGM, as well as Dr Tang Cheuk Chee from her role as Executive Director, for their contributions over the years. We wish them every success in all future endeavours.

    To my fellow directors on the Board, senior management and staff, I am grateful for your continued commitment to excellence over the last year, and for helping to chart PSC’s growth forward. We are also grateful to our customers, business associates, suppliers and shareholders for your continued support.

    Together, we look forward to a rejuvenated PSC and an exciting journey ahead!

    Dr Goi Seng Hui
    Dr Goi Seng Hui
    Executive Chairman