DEL MONTE Pacific, Ltd. (DMPL) logged a 63.8% growth in net profit attributable to owners of the company in its second-quarter ending October, higher than the $21.85 million recorded in the same period last year.
In a regulatory filing on Thursday, the company said it saw improved sales from its international business. Sales grew 4% to $650.99 million from $623.45 million year on year.
“DMPL stayed on its course to deliver a very strong financial performance for the quarter and achieved record results for the first half,” DMPL Managing Director and Chief Executive Officer Joselito D. Campos, Jr. said.
DMPL’s earnings before interest, taxes, depreciation and amortization (EBITDA) rose 14% to $107.4 million from $94.4 million.
US unit Del Monte Foods, Inc. (DMFI) generated 73% of DMPL’s sales in the second quarter worth $477.5 million after a 7% sales increase on the back of branded retail growth. The company said it reduced sales of low-margin private label products.
DMFI’s branded retail products grew 11% due to supply and distribution gains, the strong sales of its vegetable business, as well as the impact of the Thanksgiving holidays.
Meanwhile, Del Monte Philippines, Inc. (DMPI) posted a 3% sales growth from a year ago in the second quarter to $186.1 million, owing to an 18% increase in sales abroad to $69.7 million.
International sales ended higher on the back of demand for packaged fruit and beverages in the USA and Europe and S&W packaged pineapple and mixed fruit in North Asia.
“In the premium fresh fruit segment, higher sales of S&W-branded MD2 pineapple were offset by lower sales of non-S&W branded pineapple due to reduced supply resulting from [the] timing of harvest,” Del Monte Pacific said.
However, DMPL also noted that over half of the subsidiary’s sales are in the Philippines, with the international market taking the balance.
Philippine sales went down by 6% in dollar terms and 2% in peso terms to $100.2 million due to a high base. Its newly launched products, meanwhile, contributed 9% to Philippine sales in the second quarter.
Del Monte Pacific said DMPI will continue to push its key health-focused brands as well as products made for “culinary enjoyment” such as its Del Monte Tomato Sauce. It will also continue to improve its distribution network, the parent company said.
Meanwhile, DMPI’s EBITDA grew 5% to $40.6 million, while its net profit went up 10% to $26 million. The company noted that DMPI benefited from the government’s 25% reduced corporate tax rate.
For the first six months ending October, DMPL’s net profit surged $54.1 million from last year’s $18.6 million. Sales for the period posted a 7.4% growth to $1.11 billion from $1.04 billion.
Meanwhile, its EBITDA for the first six months climbed 33.3% to $182.34 million from $136.8 million year on year.
The company said it is “positioned to unlock market opportunities” in China, as well as other underserved markets.
DMPL is confident that it is “well-positioned” to build on its momentum seen in the previous fiscal year, expecting to “generate higher net profit” for the next.
“We look forward to sustaining the momentum into the second half of the year with an improved sales mix, higher new product contribution, and diversified channels to expand our brand footprint,” Mr. Campos said.
“And to help us mitigate headwinds from higher costs, our teams continue to execute against our strategy of maximizing operational efficiencies while increasing higher-margin branded sales and reducing non-core sales,” he added.
On Thursday, shares of Del Monte Pacific at the local bourse went up 9.18% or P1.34 to close at P15.94 each. — Keren Concepcion G. Valmonte
