GCB (Asia’s largest cocoa grinder and will be the world’s fourth largest cocoa grinder after Barry Callebaut AG, Cargill and Olam International Ltd)

1. Sales is more than RM2billion over the past 3 years (FY16:RM2.3bil, FY17:RM2.1bil; FY18:RM2.3bil);

2. Profit before tax rose y-o-y (FY16:RM43mil; FY17: RM91mil; FY18: RM190mil);

3. Q2Y2020 quarterly report, sales increased from RM1.4bil in FYE06/2019 to RM1.8bil as at Jun 2020 (30% growth) and profit after tax increased from RM114mil in FYE06/2019 to RM129mil as at Jun 2020 (13% growth). Total cash stood at RM56mil (FYE2018: RN47mil) VS Bank Borrowing at RM712mil (FYE2018: RM683mil);

4. Noted GCM acquired subsidiary amounting to RM120mil+ in Y2020. According to news in Dec 2019, they are buying Europe based chocolate maker, Schokinag Holding GMBH (SHG) as part of group’s global expansion strategy to expand its product range into the downstream industrial chocolate business to business market;

5. Noted profit after tax amounting to RM129mil included unrealised / realised gain from FOREX/forward currency contract / commodity future contract/ commodity option contract which are not profit from operation amounting to RM48mil (RM42mil in FYE12/2018). If we were to exclude this part, profit after tax will be RM81mil;

Overall, satisfactory financial performance as at Jun 2020. However, the business financial year ending 31 Dec 2020 will be challenging as they are selling 1st half capacity since Oct 2019.