MANILA, Philippines?CIIF Oil Mills Group (CIIF-OMG) registered $240 million in export revenues last year, a 110-percent increase from the $114 million posted in 2009.
CIIF-OMG president and chief executive Jesus Arranza said the volume of coconut oil products that the company shipped last year reached 252,651 metric tons (MT), 77.6 percent more than 2009?s 142,248 MT.
This improvement in the company?s exports enabled it to boost revenues by 57 percent to almost P14.2 billion. Operating income likewise more than doubled to P171 million in 2010 from P82 million the year before.
From 2005 to 2008, CIIF-OMG incurred losses totaling nearly P1.5 billion: P51 million in 2005, P696 million in 2006, and P746 million in 2007. These losses were mainly attributed to poor forecasting, which resulted in forward contracts with buyers even without the physical inventory of copra.
What happened then was that the company had to purchase copra at prices higher than those prevailing in the market.
Apart from the forward contracts, CIIF-OMG also incurred huge freight costs, placed at around $80 a ton, prior to 2009.
Starting 2009, however, CIIF-OMG implemented some belt-tightening measures. Last year?s operating expenses, for example, reached P738 million, only 12 percent higher than in the previous year, despite the implementation of a merit increase among employees.
Freight cost also went down to only $50 a ton. Plant utilization, on the other hand, increased to 74 percent.
?This is quite an achievement, considering there is excess crushing capacity in the country today. Total capacity is more than double the total copra production,? Arranza said in a statement.
The company was also able to pay in full its acquisition from Mitsubishi Corp. of a 40-percent stake in Manila Refining Corp., a producer of specialty fats and oils.