D&L nets P1.35B
Food ingredients and chemical manufacturer D&L Industries grew its recurring net profit by 7.5 percent year-on-year to P1.35 billion in the first semester, as favorable commodity prices boosted revenues.
For the second quarter alone, net profit rose by 1 percent year-on-year to P688 million, coming from a high base due to election spending last year.
Total revenues for the six-month period reached P12.7 billion, up by 24 percent year-on-year due to higher commodity prices.
Export sales maintained growth momentum, rising by 64 percent year-on-year in the first six months of the year. Exports accounted for 23 percent of total revenues compared with just 18 percent in full year 2016. With the company’s partnership with Ventura and Bunge maintaining pace, the food ingredients segment is now the biggest contributor to exports, accounting for 42 percent of total export sales versus just 19 percent in full year 2016.
Meanwhile, the high-margin specialty products (HMSP) further improved margins by 0.7 percentage points (ppts) year-on-year to 25.3 percent in the first six months of the year. While blended commodity margins are still lower compared to their historical average, they inched up by 1.5 ppts in the second quarter to 4.5 percent from the first quarter.
HMSP accounted for 59 percent of D&L’s evenues while the remaining 41 percent was accounted for by commodities in the first half.
Overall, net income margin compressed by 1.6 ppts to 10.6 percent. Annualized return on equity and return on invested capital for the first six months of the year stood at 17.6 percent and 20 percent, respectively.
“We remain optimistic on all our business segments,” D&L president and CEO Alvin Lao said. “Moving forward, our growth will continue to be supported by the vibrant domestic economy and still robust consumer spending. Moreover, our export business offers exciting growth opportunities for us. We remain committed to our R&D (research and development) investments that support the growing needs of our customers.”
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