i-Tail’s pet treat sales drop by over half
We dive into the details of why the Bangkok-based manufacturer posted a drop of 40% in revenue in Q2 2023.
i-Tail, the pet food division of seafood firm Thai Union, posted sales of THB 3.24 billion (€85.6M/$94.2M) in the second quarter of 2023, down from THB 5.66 billion during the same period in 2022.
Pet treats sales dropped the most (-54%), followed by cat food (-43%) and dog food (-19%). If we compare this to the first quarter of 2023, i-Tail’s pet food portfolio registered a drop in revenue of 32%.
Net profit in the quarter accounted for THB 444.9 million (€11.7M/$12.8M), 67% less than in 2022. According to the company, lower sales and the higher cost of raw materials are behind this drop.
Sales in the Americas accounted for 51.5%, followed by Asia, Oceania and Africa (40.5%) and Europe (8%). Earlier in the year, the firm announced a $2.5 million (€2.28M) investment to expand its business in China and Europe.
Inflationary pressure
The drop in sales in the quarter was attributed to inflationary pressure, lower freight revenue and destocking of inventories in the US and EU despite strong pet food demand.
The decline in gross profit for Q2 2023 was attributed to higher raw material costs, lower selling volumes and higher fixed costs per unit.
The first half of the year
Sales in the first half of the year also dropped but at a lower rate. From January to June, i-Tail posted revenue worth THB 6.82 billion (€180.4M/$198.6M), a drop of 29.6% against the same period in 2022.
Net profit went down by 61.5% to THB 870 million (€22.9M/$25.2M).
In November 2022, i-Tail raised $588 million (€544.7M) after going public on the Thailand Stock Exchange.
