In Q4/2022, Ichitan Group (ICHI) experienced strong growth, with a notable 25.5% increase in revenue and a third consecutive quarter of achieving new high profits with total revenue of 6,340.4 million THB for 2022. With many contributing factors, the domestic spending power is rebounding, the health trend is flourishing, and the ready-to-drink tea market is rising, showing a remarkable growth rate of 22.88%, surpassing that of the overall beverage market. Furthermore, the latest product, Tansansu, exceeded expectations and received an impressive response. Likewise, the ongoing popularity of economy drinks among consumers, such as Ichian, YenYen, and Bireley's, has enabled Ichitan Green Factory to utilize its higher production capacity efficiently. While Ichitan's OEM service has secured 2 new deals with major players, the export business is showing positive signs in the CLMV market and plans to expand into new markets in the Middle East. Greenlight was given to a .60 THB dividend
Ichitan Group PCL's CEO, Mr. Tan Passakornnatee, announced the company's operating results for the year 2022, which showed a top-performing year with a net profit of 641.6 million THB, representing 17.3% growth from the previous year's net profit of 546.77 million THB, and a total income of 6,340.4 million THB, representing 21.3% growth. The 4th quarter profit reached 192.9 million THB, marking a new high for the 3rd consecutive quarter. Notably, the 4th quarter exceeded the high season 2nd and 3rd quarters.
Ichitan's strong performance is supported by several factors, including the recovery of purchasing power in domestic and international markets as the epidemic continues to improve. Consumers have returned to everyday life, including work, daily spending, and tourism, in line with the overall growth of the non-alcoholic beverage industry. Within this industry, the ready-to-drink tea category has shown the highest growth rate, at 22.88%, exceeding the overall beverage market's average growth rate of 6.2%.
The growth of Traditional Trade distribution channels of Ichitan, which has reached 35.67%, has been driven by the high demand for small-sized and affordable products such as Ichitan, YenYen, and Bireley's. This has enabled the company to distribute its products to a broader range of stores. As a result, the production rate of Ichitan Green Factory has increased due to continuous production, with a current capacity of 75 million bottles per month. This economy of scale has resulted in lower production costs per bottle, leading to improved profitability.
Combining with product development strategies that add value, such as the launch of "TANSANSU," a Korean soda targeting Gen Z consumers who enjoy trying new things and are fascinated by K-POP culture, recently introduced its first international presenter, the Korean-international artist "Mark Tuan -GOT7." "Ichitan 0 calories plus catechin," a high-quality tea for health-conscious consumers with a 0% sugar formula and 0 calories, has supported the healthy living trend. These products contributed to a gross profit Margin of 21% in 2022, compared to the average gross profit level of 17.5%, showing effective cost management is on the rise.
As a result of the company's marketing campaigns in CLMV countries, the export market has been recovering, with positive signs emerging as COVID-19 settles. Ichitan is now preparing to expand its distribution channels to Middle Eastern countries to strengthen its international market. Ichitan's OEM service has recently secured deals with 2 major brands, and production is expected to commence in the first quarter of 2023. The company also currently expects to close more deals with several other brands. Additionally, Ichitan Indonesia's performance has exceeded expectations, thanks to successful new product development and achieving an Ichitan profit of 82.2 million THB out of 164.4 million THB from Ichitan Indonesia, surpassing the set target.
The dividend payment for 2022 at the rate of 0.60 baht per share (operating period from 1 January 2022 to 31 December 2022) has been approved by the Board of Directors Meeting. The list of shareholders eligible to receive dividends as of the Record Date of May 9, 2023, with the dividend payment due on May 24, 2023, subject to approval at the Annual General Meeting of Shareholders on April 27, 2023
With substantial financial potential, good liquidity, and no long-term debt, Ichitan Group has achieved impressive performance in 2022 and is well-positioned to capitalize on new opportunities.