Del Monte maintains the rebound of its strong PH subsidiary – Manila Bulletin
Del Monte Pacific Limited (DMPL) reported net income of US $ 18.3 million in the first quarter ending July of its fiscal 2022, reversing the loss of US $ 3.2 million in the same period l ‘last year.
In a disclosure to the Philippine Stock Exchange, DMPL said EBITDA reached $ 75.0 million, an increase of 77% from $ 42.4 million.
The group significantly improved its margins by 600 basis points to 28.9% thanks to better sales of higher-margin branded products in the United States and at lower costs.
“Del Monte Foods’ turnaround last year set it on a path to higher profitability as our team executes our strategy of increasing higher margin brand sales and reducing non-core sales.” said DMPL Managing Director and CEO Joselito Campos, Jr.
He noted that “Our exports of fresh pineapple to Asian markets have also recovered and generated growth through the expansion of offline and online channels. These critical initiatives are reflected in the strong first quarter results and we are confident of continued execution going forward. “
“We will continue to grow our revenues through an innovative product portfolio, greater product availability through better distribution and expanded sales channels, including e-commerce. In an environment with more emphasis on health and wellness, DMPL is well positioned to meet the needs of consumers, given our nutritious, long-shelf life products that allow consumers to prepare meals at home. and strengthen their immunity, ”Campos added.
DMPL said it is well positioned to build on the momentum achieved in fiscal 2021 and expects to offset the impact of headwinds in commodities and transportation. Barring unforeseen circumstances, the Group expects to generate a higher net profit in fiscal year 2022.
DMPL said it generated sales of $ 462.1 million, up 12% from the previous year period thanks to higher sales in the United States and international markets.
The Group’s US subsidiary, Del Monte Foods Inc. (DMFI), generated sales of US $ 298.1 million, or approximately 65 percent of Group sales.
DMFI’s first quarter sales grew 11% driven by strong retail and branded foodservice, which saw a combined 17% growth, while low-margin private label sales were reduced as expected.
Improved procurement and distribution gains resulted in an increase in volume in major categories, primarily canned vegetables and fruit.
New products launched over the past three years contributed 4.8% to DMFI’s total sales in the first quarter.
The Group’s second largest and most profitable subsidiary, Del Monte PhiIippines, Inc. (DMPI), achieved higher sales of US $ 176.0 million, up 20% from the same period of the previous year through sales in the international market.
This increased net income 37% to US $ 25.6 million and EBITDA by 19% to US $ 39.9 million. DMPI benefited from a reduced corporate tax rate of 25% with the adoption of the Law on Business Recovery and Tax Incentives for Businesses (CREATE) in March 2021.
More than half of DMPI’s sales are made in the Philippines, the rest on the international market.
DMPI’s international sales increased 40% to US $ 67.8 million driven by strong sales of packaged fruit and beverages, including premium packaged pineapples (Del Monte Deluxe Gold) in the United States. United and S&W packaged products in Asia.
The Premium Fresh Fruit segment, mainly composed of S&W MD2 brand pineapples, continued to recover from the first quarter of last year which was impacted by the pandemic in China.
In the Philippines, sales reached US $ 92.1 million, 2% more in US dollars but 2% less in pesos, as strong growth in the Convenience Cooking and Dessert segment was offset by a slowdown in the category. Healthy drinks and snacks.
Beverages had an exceptional quarter the previous year. However, compared to the first quarter of two years ago, sales in the Philippines increased 16% in peso terms.
Growth was driven by continued promotions of Del Monte products in everyday meal recipes for pineapple and tomato sauce, as well as new simple mixed fruit desserts.
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