DEL MONTE Pacific Ltd. (DMPL) projected up to $7 million in revenue from its dairy products in the Philippines under a partnership with Vietnam Dairy Products JSC (Vinamilk).
“In terms of sales, as we would be launching in the middle of the year, we expect the revenue to be anywhere between $5 [million] to $7 million,” said Parag Sachdeva, chief financial officer of Del Monte Pacific, in a virtual briefing on Friday.
“But considering that it is a significant launch for us, it would definitely require more investments too in terms of marketing and also listing the product in the marketplace,” he added.
Mr. Sachdeva said the company does expect profit in the first year after its launch in the Philippines.
“We expect to be breakeven by year three,” he added.
The generated revenue will be under subsidiary Del Monte Philippines, Inc., which announced in August that it would venture into the Philippine dairy sector under a “strategic alliance” with Vinamilk. Both companies will be providing 50% to the total investment capital of the joint venture.
Vinamilk has 13 dairy farms, nearly 160,000 cattle, 13 factories, and 250,000 retail outlets in Vietnam. It also operates three factories in the United States, New Zealand, and Cambodia, and an organic dairy farm complex in Laos.
For the first quarter of its fiscal year ending in 2022, Del Monte Pacific posted a net profit of $18.3 million, a turnaround from the $3.2-million loss it incurred in the same period a year ago. Its sales for the period improved 12% to $462.1 million.
On Friday, its shares rose 8.05% or P1.08 to close at P14.50 each. — Revin Mikhael D. Ochave
