Del Monte Phillippines earns P900M in first quarter

Del Monte Philippines, Inc. maintained a year-on-year P900-million net profit in the three months to July on the back of “strong” domestic sales in the period.

The listed food and beverage firm on Friday said it booked P1.4 billion in operating income in the quarter, rising by 27% “with higher sales and improved sales mix in the Philippines, lower costs, better margins, and controlled operating expenses.”

It posted P7.4 billion in overall sales, mainly attributed to the 18% year-on-year growth of its Philippine sales to P4.5 billion. “The higher revenue demonstrates Del Monte’s brand strength and solid fundamentals amidst the pandemic,” the company said.

The sales improvement was shown in its culinary, beverages, and fruit businesses, especially during the pandemic when consumers stayed at home and prepared home-cooked meals.

Sales from its retail channels grew by 32%, offsetting the decline in foodservice sales after shifting to e-commerce and community delivery services. The move was done to partially recoup from the impact of restaurant closures during the lockdown period.

The domestic sales growth cushioned the impact of “lower’ international sales – coming from S&W brands operating across Asia and the Middle East – which stood at P2.4 billion.

“Sales were down in the first quarter as higher sales of shelf-stable packaged products were offset by lower sales of fresh pineapples in China,” the company noted. Fresh pineapple sales were also impacted.

With the slow decline in international fresh fruit sales in July, “the company expects its fresh business to expand in the remainder of the year and improve its margins with cost management and operational efficiencies,” it said.

Likewise, its international business, in general, showed “encouraging signs” of recovery, Del Monte said. — Adam J. Ang