Asia operations boost Del Monte Q2 profit to $21M

Campos family-led food and beverage conglomerate Del Monte Pacific Ltd. (DMPL) grew its core profit by about a third year-on-year to $21 million in the quarter ending October as Asian operations made up for the slack in its US business.

Inclusive of one-off items, net income for the second quarter of its fiscal year fell to $20.2 million versus the previous year’s $47.8 million.

For the six-month period ending October (the first semester of DMPL’s fiscal year 2017), the group’s profit excluding the one-off items would have been $15.1 million or more than double last year’s $6.9 million. With the inclusion of the one-off items, the group generated a net income of $11.4 million—lower than last year’s $37.1 million, which factored in a net one-time gain of $30.4 million due to the retirement plan amendment of its US unit, Del Monte Foods Inc. (DMFI).

Barring unforeseen circumstances, DMPL expects to remain profitable for the rest of fiscal year 2017.

“The excellent results in the Philippines and the S&W Asian markets, where our teams delivered on both sales expansion and productivity improvement resulting in cost reduction, underscore our strategy to tap into consumption driven growth in Asia, which is fueled by an emerging middle class [and] at the same time, seeking to create efficiencies throughout our operations,” Joselito Campos Jr., managing director and group chief executive of DMPL, said in a press statement.

Campos said its Asian operations, which include the S&W brand that it purchased in 2007, offset the tepid business in the US. He said operations in the US have been affected by shifting consumer preferences.   Doris Dumlao-Abadilla