Branded consumer: Thailand bogged down by civil unrest 
1Q BC sales fell 6% yoy. Lower sales were a feature in Thailand, Myanmar and Singapore. Thailand (30% of BC sales) was the biggest drag on 1Q as sales dropped 11% yoy, due to currency and real consumption slowdown effects. Myanmar' s weakness (-5% yoy) is mainly due to a reduction in selling prices in 2H13 when Super Group cut prices by 6-7% to soften the blow of the collapsed kyat for wholesalers, with relatively flat volume growth. In Singapore (-11% yoy), the sales decline is due to the transition of the cereal business and real loss of coffee market share for its Owl brand. The broad picture is one that shows slowing consumption across markets. It does not look pretty.

Ingredients: worrying trends 
Food ingredients or FI (1Q: -6% yoy) used to be booming, then China demand evaporated in 2H13 and in 1Q14, SE Asia customers followed suit. Indonesia, the largest SE Asia market for FI, saw sales dropping 30% yoy as endcustomers stocked up in 4Q, ahead of higher raw material prices. Coupled with the weaker Rp, this led to lower 1Q FI sales even if East Asia demand (+6% yoy) is on the mend, driven by strong Taiwan sales. China has yet to turn around.

Rising commodity prices not yet a dampener 
1Q was essentially plagued by a slowing topline. Gross margins (38%) was stable even if robusta coffee, sugar and CPO prices have risen. We believe that this is because 1Q margins reflected 4Q commodity prices and higher prices have yet to filter through in 1Q. Headwinds are aplenty