MANILA, Philippines – Del Monte Pacific Ltd. reported a net income of $41.9 million in the nine months of its fiscal year ending January 2016, a reversal of the $23.9 million loss in the same period a year ago.
In a disclosure to the Philippine Stock Exchange, Del Monte said net sales rose six percent to $1.7 billion on the back of the improved performance of its operations here and in the US.
US subsidiary Del Monte Foods, which accounted for 80 percent of groupwide sales, generated $1.4 billion in revenue or eight percent higher than the year earlier.
Operations in the Philippines also went well with sales rising seven percent as demand for juices, tomato-based sauces and packaged pineapple products strengthened.
Meanwhile, sales of the S&W branded food and vegetable business in Asia and the Middle East grew 16 percent on higher sales from both the fresh and packaged segments.
In the third quarter, however, Del Monte Pacific registered sales of $594.1 million, down by seven percent due to lower sales in DMFI mainly as a result of unsuccessful government and co-pack contract bids. This was partly offset by the good performance in the Philippines, which went up six percent with effective holiday season advertising campaigns.
The rest of Asia under the S&W brand performed strongly, growing 35 percent. China and Japan markets grew significantly on higher sales of canned tropical fruits and fresh fruits.
“In the US, lower sales to the government and co-pack sectors unfavorably impacted our third quarter sales and may continue to impact our fourth quarter sales. We are reviewing our strategy for these channels as part of our long range plan to optimise sustainable sales and profits for the company in the coming year,” said Joselito Campos, Jr, managing director and group CEO of DMPL.
Meawnhile, DMPL said it intends to issue US dollar denominated perpetual preference shares in the Philippine capital market, to be listed on the Philippine Stock Exchange.
“The group anticipates to launch the offering this year subject to regulatory approvals and market conditions. The proposed issue will be up to $360 million that will result in a further improvement of the group’s leverage ratios,” DMPL said.
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