Axelum Resources Corp. saw its net income declined by almost a half in the first quarter as disruptions caused by the global pandemic weighed down on its domestic and export businesses.
The listed coconut products manufacturer in a stock exchange disclosure on Friday said its earnings dropped by 47% in the first three months of the year to P120.9 million, compared with P226.4 million it reported in the same period in 2019.
“After posting the highest level of profitability in our history last year, our growth momentum was interrupted by the outbreak of the COVID-19 health pandemic, which caused significant economic disruptions in most parts of the world,” Axelum President and Chief Operating Officer Henry J. Raperoga said in a statement.
Axelum’s topline decreased by 6% to P1.20 billion in the January-March period from P1.28 billion in the same months a year ago.
It claimed it was able to sustain its profitability with only a “marginal” decline in sales. “While [operational] costs were elevated, this was a result of extraordinary measures that were undertaken to address the current situation,” it said.
The coconut exporter said it is seeing stability in input prices as the government further eased its quarantine policies.
Intending to proceed with targeted spending, Axelum said its long-term prospects remained “intact” as its performance is steadily improving since the start of the pandemic crisis.
For example, the company is still on course to produce and deliver at least 25 million liters of coconut water for Vita Coco this year.
“Our long-term view on the coconut industry opportunity remains intact and our business plan remains the same with enough flexibility to cushion the prolonged effects of COVID-19. We shall keep growing our business organically and selectively consider acquisitions,” Mr. Raperoga said.
Last week, the company decided to redirect P1 billion out of the P4 billion proceeds from its initial public offering to debt repayment. The portion was originally intended for its strategic acquisitions and distribution network expansions. — Adam J. Ang