Lower input costs helped animal feed and food product manufacturer Vitarich Corp. post a 540-percent surge in its first-half net income to P167 million.
This despite the decline in total revenues by 3.1 percent to P6.126 billion, dragged down by the feeds segment. Higher earnings from the foods segment, however, partially offset the drop, according to the listed firm’s disclosure to the Philippine Stock Exchange.
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“The decline in the feeds segment was a result of dampened demand for hog and poultry feeds, while the strength in the Foods segment was fueled by volume gains but tempered by muted price trends,” Vitarich said.
Gross profit climbed by 55.3 percent to P705.26 million due to lower input costs and higher productivity from farm efficiencies. It noted that average raw material costs decreased by about 10 percent.
“Our priorities are to gain scale and pursue opportunities to drive profitable growth. Our first-half performance reflects this and shows that we are on the right track with our long-term strategy,” Vitarich president and CEO Ricardo Manuel Sarmiento said.
Vitarich said its feeds segment, accounting for 36.9 percent of revenues, saw its revenues decline by 18.3 percent to P2.259 billion as it registered lower sales volume, particularly in Luzon.
The continued presence of the African swine fever and low farm-gate prices of chicken “dampened” the demand for feeds.
The foods segment’s revenues, on the other hand, rose by 6.3 percent to P3.585 billion on the back of a 9.1-percent growth in sales volume headlined by faster growth in Visayas. It comprised 58.5 percent of revenues.
Sarmiento is looking forward to expanded contribution of its Cook’s chicken brand to “boost the brand’s presence and enable retail demand.” INQ