MANILA, Philippines—Concepcion-led food and beverage company RFM Corp. grew its first-quarter net profit by 30 percent to P130.3 million from year-ago level, as robust growth in domestic consumer spending boosted sales revenue while input cost pressures eased.
In a statement on Monday, RFM said its three-month performance could be attributed to higher sales revenue and the decline in the costs of inputs such as milk and sugar.
The rationalization of production processes and focus on higher-margin products also helped improve the profit picture. RFM reported that its sales expanded by 16 percent in the first quarter to P2.4 billion.
RFM president Jose Concepcion III said Selecta, the company’s ice cream joint venture with Unilever, posted a sales growth of more than 37 percent in the quarter.
“This rate would be even higher if we look at March alone year on year, since it was the month we introduced the latest ice cream craze Magnum (Belgian chocolate enrobed ice cream on stick).” Concepcion added that demand for Magnum had been way beyond expectations and stocks were running out, prompting the company to make arrangements to boost supply.
Selecta Cornetto ice cream products have also been doing well, with growth rates of 50-60 percent, he said.
RFM’s Fiesta pasta business also marked a growth of more than 70 percent, resulting in an increase in its market share to more than 30 percent from 25 percent last year, Concepcion said.
The company’s White King brands of cake mixes, Arroz Caldo and Champorado have also posted a 30-percent year-to-date growth.
“We believe that stronger brand equity and product innovations have influenced the shift in buying pattern and frequency in a number of categories we participate in,” Concepcion said.
RFM reported that aside from Selecta ice cream and Fiesta pasta, sales of Selecta milk, Sunkist litro pack and Swift Mighty Meaty and Corned Beef Swak also performed “very well.”