LISTED food and beverage manufacturer Monde Nissin Corp. said it trimmed its net loss to P626.58 million in 2023 from P13.01 billion the prior year.

“Reported net loss for the year was P625 million, mainly due to a noncash, nonoperating impairment of assets in the meat alternative business of P10.1 billion after-tax, partly offset by P1.3 billion of guaranty asset gain,” Monde Nissin said in a stock exchange disclosure on Thursday.

The company’s consolidated revenue rose by 8.4% to P80.17 billion, led by volume growth in the Asia-Pacific branded food and beverage (APAC-BFB) segment, which saw a 12.6% sales growth to P65.94 billion.

“The APAC-BFB business saw strong top line growth and profitability, driving record revenues and translating into strong operating cash flows. This growth was aided by both volume and price across all our categories,” Monde Nissin Chief Executive Officer Henry Soesanto said.

However, Monde Nissin saw a 7.6% decline in its meat alternative revenue to P14.23 billion.

“For meat alternatives, we continue to face a challenging environment, which necessitated us incurring a further impairment of P10.1 billion after-tax this year, which was largely offset by the previously announced financial support offered by Monde Nissin’s controlling family shareholders, such that retained earnings were minimally impacted at the level of the listed parent company,” Mr. Soesanto said.

“The impairment was due to a higher weighted average cost of capital and a tempered earnings before interest, taxes, depreciation, and amortization cash flow forecast,” he added.

Mr. Soesanto said the company will focus on cost reduction to reduce the risk of “further substantial impairments.”

“Despite these continued category headwinds, our food service business continues to perform well, showing 6% revenue growth for the year,” he said.

Meanwhile, Mr. Soesanto said that Monde Nissin expects low single-digit revenue growth in the first quarter for its APAC-BFB business.

“During the first quarter, we expect low single-digit revenue growth, partly due to the timing of the Holy Week holiday in the Philippines, and a robust gross margin improvement of more than 600 basis points (bps) year over year and more than 300 bps sequentially,” he said.

In a separate disclosure, Monde Nissin said its board approved a move to reallocate P228.8 million of its unused initial public offering (IPO) proceeds as capital expenditure (capex) funds this year for the company’s APAC-BFB segment.

The reallocated funds were previously earmarked for IPO-related expenses. Monde Nissin conducted its IPO in 2021.

“The reallocation arises from underspending in the friction cost budget for the IPO,” Monde Nissin said.

Some of Monde Nissin’s brands include Lucky Me! noodles, SkyFlakes crackers, Fita crackers, Monde baked goods, and Quorn meat alternative products.

On Thursday, Monde Nissin shares dropped by 4.19% or 46 centavos to P10.52 per share.  Revin Mikhael D. Ochave