San Miguel Foods income up 21% in 2022 despite inflation
The food division of conglomerate San Miguel Corp. saw profits in 2022 rise 21 percent due to strong demand despite cost pressures from surging inflation.
San Miguel Foods (SMF), part of San Miguel Food and Beverage Inc., ended the year with a profit of P9.2 billion.
“Throughout the year, our food division faced unprecedented cost pressures from higher commodity prices, rising inflation and a weaker peso,” SMC president and chief operating officer Ramon S. Ang said in a statement on Wednesday.
“Despite that, it remained resilient and even managed to grow operating income by 15 percent to P13.3 billion as it optimized utilization of company-owned facilities and undertook cost management measures,” he added.
Earnings were lifted by record-breaking sales for the third-straight year since the pandemic arrived, the statement showed.
Total revenue jumped 16 percent to P175.3 billion from P151 billion in the same period last year.
This was due to higher sales volumes and “intensified distribution, aggressive promotional activities, launch of new products and utilization of additional capacity from new facilities.”
The food group also implemented price increases to partly cover rising costs and maintain margins.
The company’s animal nutrition and health segment also grew on the back of higher sales of broiler, layer, and hog feeds. Bolstering income was rising demand for pet care and animal veterinary medicine products.
Meanwhile, the poultry and meats division grew earnings due to an increase in chicken prices. This was triggered by industry-wide product capacity shortages in 2022.
“Strong recovery of food service and positive market acceptance for the marinated Timplados line helped drive volume. Meanwhile, the Company continues to downsize its hog operations due to the African Swine Fever,” SMF said.
The prepared and packaged food segment delivered strong revenue growth led by flagship brands Purefoods Tender Juicy Hotdogs and Purefoods Chicken Nuggets.
Processed meats recorded “significant volume growth” and an increase in market share across multiple categories while the flour division also increased selling prices.
“SMF has been aggressively expanding its feedmills, poultry farms and food processing facilities in the last seven years to ensure supply and bolster food security in the country,” the company said.
The food group includes San Miguel Foods Inc, The Purefoods-Hormel Company Inc., Magnolia Inc., San Miguel Super Coffeemix Inc., and San Miguel Mills Inc.
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