By Arra B. Francia, Senior Reporter
CENTURY Pacific Food, Inc. (CNPF) is setting aside P2 billion for capital expenditures (capex) this year to expand its capacity, as it targets to grow its bottom line at a double-digit pace.
CNPF Executive Chairman Christopher T. Po said about half of the budget will finance the construction of a new tuna cannery in General Santos City. Scheduled to be operational by the fourth quarter of 2019, the cannery will add 100 metric tons to CNPF’s capacity.
The listed canned goods manufacturer earlier said its existing tuna canneries have been running at full capacity of 300-350 metric tons per day, prompting the need to expand. The new facility is expected to satisfy CNPF’s requirements for the next three to five years.
The remaining capex will be spent on investments that will boost CNPF’s efficiency.
“There are also cost reduction or efficiency capex, where we invest in new equipment, automation, to make our operations more competitive, and then just run of the mill repairs and maintenance,” Mr. Po told reporters after the company’s annual shareholders’ meeting in Pasig City yesterday.
The company’s capital spending this year is 11% higher than the P1.8-billion capex in 2018.
Meanwhile, Mr. Po noted how there have been improvements in the business environment such as easing inflation, stronger peso, and lower tuna prices, helping the firm see better results for the year.
“We just finished the first half. The peso’s stronger, interest rates are lower, so our interest expense should come down. Also our key raw materials, tuna prices are also down so we’re still as a management team going for double-digit growth this year,” Mr. Po explained.
In the first quarter of 2019, CNPF reported an eight percent increase in net income attributable to the parent to P792.54 million, following a 10% uptick in gross revenues to P9.85 billion.
Branded tuna products currently account for 32% of CNPF’s business, followed by milk at 20%. The company’s brands include Century Tuna, 555, Blue Bay, Fresca, Lucky 7, Argentina, Birch Tree, Kaffe de Oro, and Home Pride, among others.
The company is set to launch more products within the year, although Mr. Po declined to disclose further details.
Mr. Po said they also remain on the lookout for acquisition opportunities that will further expand the company’s portfolio.
“If we find something that fits our strategy, we know how to run it, and the valuations are reasonable, then we will definitely consider it…Our preference would be domestic, there’s enough happening in the Philippines, especially if it’s acquisition, we don’t have to stray too far from our home market,” Mr. Po said.
Shares in CNPF rose 0.13% or two centavos to close at P15.04 each on Monday.