QAF reported a good set of 3Q16 earnings. Overall revenue was 13% lower YoY to S$212.4m following the deconsolidation of results from GBKL since Apr-16. Nonetheless, sales had increased for all segments (Bakery, Primary Production, Trading & Logistics), on the back of new products, better prices and higher sales volume.

The deconsolidation also resulted in lower operating costs, while both Bakery and Rivalea continued to enjoy lower raw material costs. Thus PATMI for the quarter was up 84% to S$19.4m, which was above expectations, as it was also helped by lower taxes paid by certain subsidiaries.

We maintain our BUY rating while our fair value estimate of S$1.33 is under review..

Source: OCBC Research - 14 Nov 2016