Thai Union Frozen Products Plc (TUF), the country's largest tuna exporter, expects a record high bottom line this year and is aiming for a net profit of 3 billion baht next year, according to president, Mr Thiraphong Chansiri.

"This year, our profit is likely to break the record, our earnings before interest, tax, depreciation and amortisation (EBITDA) are stronger and cashflow is in good position," said Mr Thiraphong.

"We are now looking at how to raise our profit to 3 billion baht and EBITDA to exceed 5 billion. We feel confident about achieving this goal in 2010."

The company last year earned a net profit of 2.2 billion baht, a rise from 1.82 billion a year earlier, with EBITDA of 4.26 billion baht.

TUF yesterday reported a 136.6% year-on-year gain in net profit for the second quarter to 954.5 million baht, with a gross margin at a historic high of 16.2% compared with 13.4% in the same period a year ago and 12.1% in the first quarter.

The profit came despite the booking of a shutdown expense of 160 million baht for a Samoan plant, which will be relocated to the US state of Georgia. TUF plans to book a total of $10 million (340 million baht) for shutting down the plant this year.

The Georgia plant will have annual output of 4 million cases and will start manufacturing from Oct 1.

Mr Thiraphong said sales revenues for the second quarter rose 2.4% year-on-year to 17.19 billion baht. In US dollar terms, however, revenues fell 4.2% to $496.7 million, attributed mainly to a price decline in raw materials, leading to lower selling prices.

For the first half, net profit grew 63.8% to 1.6 billion baht, compared with 981.4 million a year ago with sales in baht rising 8.2% to 34.86 billion baht. Sales in US dollars fell 0.1% to $995.8 million.

Tuna products accounted for 43% of sales, followed by frozen shrimp (20%), canned seafood (9%), canned cat food (8%), shrimp feed (7%), canned sardines (5%), products for the domestic market (5%), and frozen squid (3%).

Mr Thiraphong acknowledged that sales growth could fall as overall selling prices were likely to be lower than last year due to general cost deflation.

TUF now projects sales growth in baht terms of 10% this year, down from 15% estimated earlier, with sales in dollars rising 5%, down from 10% earlier.

"We're focusing more this year on profitability than sales," he said. "The profitability prospects are brighter next year, as the company expects to greatly benefit from the manufacturing plant restructuring and the management merger of two US subsidiaries, TriUnion Frozen Foods (Chicken of the Sea Frozen Foods) and Empress International."

The company also plans to build a new cold storage facility with a capacity of 40,000 tonnes at Mahachai in Samut Sakhon. The one-billion-baht plant is due to be completed next year.

The investment is on top of estimated spending of about 1.6 billion baht planned for this year.

TUF shares closed yesterday on the SET at 25.50 baht, up 60 satang, in trade worth 56.8 million baht.