The share price of Pluk Phak Praw Rak Mae Public Company Limited (SET: OKJ) dropped 30% last Friday and another 8% on Monday to settle at THB10.00 per share, following the investor’s selling pressure after the 2024 performance was lower than the analysts anticipated. This underperformance was due to the significant increase in the cost of expenses during 4Q24, which also dragged down the net profit.
Ms. Phawisphen Leoratanapaiboon, CFO of OKJ, revealed to Kaohoon that the company recorded sales expenses of THB681.9 million in 2024, a 44% increase from the previous year, and administrative expenses of THB149.3 million, up 31.1%. She confirmed these were one-time expenses, including marketing costs, recovering expenses from natural disasters, IPO-related expenses, and new branch openings, all incurred in 4Q24.
The expense from the marketing cost stemmed from Oh! Juice’s promotion of its new flavor, “Material Girl Smoothie,” at an event in Siam Square One, where celebrity Chompoo Araya participated as a brand admirer. OKJ considered this a cost of investment. For recovering costs, OKJ lost expenses of only approximately THB2 million due to flood damage at its vegetable farm. As for the listing costs, the expense was related to the company’s initial listing on the Stock Exchange of Thailand (SET), which is a one-time loss.
Regarding new branches, OKJ typically opens three to four per quarter. However, in 4Q24, the company launched 12 branches, two Ohkajhu in Bangkok, two in the northeastern region, six Oh! Juice in Bangkok, and two in other provinces, resulting in significant pre-opening costs and promotion campaigns during that quarter. Ms. Phawisphen confirmed the new branch opening in 2025 will be more balanced.
Besides the one-time expenses, OKJ also faced volatility in raw ingredient costs, which are beyond its control. The increase was driven by weather conditions in various countries. However, OKJ expects costs to decline in 2025 as supply loosens. Since the company does not stockpile ingredients and purchases them regularly, OKJ is actively seeking alternatives and negotiating lower prices with suppliers. Nonetheless, ingredient cost fluctuations are expected to be below 1%.
Ms. Phawisphen stated that OKJ’s net profit margin in January 2025 is recovering, with its average margin typically ranging between 8.5% and 9.5%. The company plans to open 16 to 20 new branches this year, with a total investment capped at THB160 million. For 1Q25, OKJ aims to launch 2 to 3 branches, introduce new menus, and collaborate with partners to boost sales and drive growth.
The share price of OKJ made a slight recovery on Tuesday with a gain of 4% to close the morning session at THB10.40 per share.
