By James A. Loyola
Del Monte Pacific Limited reported a net income of US$11.4 million for the first half of its fiscal year ending April 2019, a turnaround from the US$2.1-million loss in the same period last year.
However, without one-off items, net income would have been lower at US$3.6 million. The firm said a change in US tax rate lowered recurring net income by US$6.5 million.
The Group generated sales of US$993.5 million, down 10 percent versus the same period last year mainly due to the planned divestiture of Sager Creek and lower sales in the USA.
For the second quarter ending in October, net income amounted to US$8.4 million, a turnaround from the US$2.8-million loss in the prior year quarter.
Excluding the one-off gain of US$1.1-million post-tax, the Group would have incurred a net income of US$7.3 million versus the recurring profit of US$10.2 million in the prior year period.
The Group generated sales of US$556.3 million, 11 percent lower than prior year quarter. Stripping out Sager Creek’s sales, second quarter Group sales would have been lower by 6 percent.
Del Monte Foods, Inc. contributed US$418.5 million or 75 percent of Group sales. DMFI sales declined by 14 percent mainly due to the divestiture of Sager Creek and lower retail sales including private label, in line with DMFI’s strategy to deprioritize non-profitable businesses.
Sales in the Philippines domestic market decreased by 3 percent in peso terms and by 8 percent in US dollar terms mainly in the general trade and mixed fruit category as the Group continues to address operational issues in that channel. Modern trade and foodservice continued to grow.
Sales of the S&W business improved by 17 percent in the second quarter due to strong sales of fresh pineapple in North Asia, offsetting declines in packaged pineapple.
Competition from cheaper canned pineapple products from Thailand and Indonesia continued to impact S&W’s packaged business. Pasta sauces from the Philippines, sold in S&W’s Asian markets, continued to do well.