(Bloomberg) — Monde Nissin Corp., the Philippines’ largest instant noodle maker, may take an impairment charge of as much as $126 million for 2024 as it struggles with its meat-alternative business.
An ongoing annual impairment test for the meat-substitute arm indicates an impairment charge of between 80 million pounds ($101 million) and 100 million pounds ($126 million), the company said in a statement on Wednesday.
The figure is “substantial” although it’s lower than the previous year’s level, it said. In 2023, Monde Nissin reported an equivalent of 138 million pounds in impairment loss.
The prospect highlights how the alternative food sector may be grappling with waning enthusiasm for substitutes to beef and pork amid inflation-driven increases in production costs and more selective consumers.
“Our meat alternative business continues to operate in a challenging environment,” Chief Executive Officer Henry Soesanto said. The food manufacturer anticipates meat alternative sales — led by its flagship brand Quorn Foods — to decline by mid-teens in the fourth quarter from a year ago. The company plans to hold its earnings call in March.
Monde Nissin acquired Quorn Foods Ltd, a British firm, for $833 million in 2015. Its sales of the fake meat slid 4.3% in 2023. The company said at the time that its controlling family shareholders were committed to protect it from impairment and losses of Quorn in the next 10 years.
Despite the challenges on meat substitutes, consolidated sales likely grew by more than 3% in 2024, it said in the statement. In fourth quarter alone, revenues from its Asia Pacific branded food and beverage business expanded by over 8% on-year, supported by both domestic and international markets.
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