CENTURY PACIFIC Food, Inc. (CNPF) delivered a 9% increase in earnings for the second quarter of 2018, driven by the double-digit growth in branded revenues amid higher costs of raw materials.
In a regulatory filing, the listed canned goods manufacturer said its net profit reached P838.9 million in the April to June period of 2018, higher than the P767.5 million posted in the same period a year ago. Revenues for the quarter went up by 19% to P10.2 billion.
This pushed the company’s top-line performance 20% higher in the first six months of 2018 to P19.3 billion. Net income accordingly rose 7% to P1.57 billion.
The company noted a double-digit growth across branded marine, meat and milk products for an overall 25% in branded sales to P14.4 billion. Products under CNPF’s portfolio include Century Tuna, Argentina, Swift, 555, Angel, and Birch Tree, among others.
Meanwhile, its original equipment manufacturer (OEM) export business booked a 9% uptick to P4.9 billion in the first half. The company exports canned tuna products to North America, Europe, Asia, Australia, and the Middle East.
“We saw branded sales surge during the first half, as we hit records in terms of volumes sold and distribution outlets reached. We believe local macroeconomic factors have favored demand for our products, which have wide appeal and reach a broad consumer base,” CNPF Chief Finance Officer Oscar A. Pobre said in a statement.
Despite the strong performance during the period, the company said it remains on watch for rising input costs that may weigh down full-year earnings results. Mr. Pobre said they continue to see rising prices of certain raw materials and items like packaging, freight, and other expenses.
For instance, cost of sales consisting of raw materials, packaging costs, manufacturing costs, and direct labor costs surged by 21% to P14.22 billion. The increase was mostly seen in the prices of tuna, meat and packaging.
“We are hopeful that the robust sales numbers will continue, but expect more muted year-on-year increases from here as we face higher revenue comparable periods moving forward. We are also watchful as competition intensifies, though remain positive that our market leadership and growth prospects in emerging categories will help mitigate the effects,” Mr. Pobre said.
CNPF earlier said it expects net income to grow in the mid-single digits and revenues to grow in the teens for 2018.
The firm is investing up to P1.8 billion this year to expand its capacity, which includes a new tuna facility in General Santos City expected to be completed by the third quarter of 2019.
Shares in CNPF dropped two centavos or 0.13% to close at P15.48 each at the stock exchange on Wednesday. — Arra B. Francia
