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Friday, March 29, 2024

Del Monte posted $3-m net income in first quarter

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Boosted by one-off gain, fruit grower and canner Del Monte Pacific Ltd. posted a net income of $3 million from the May-to-July period, up from $700,000 year-on-year.

Excluding gains from the purchase of unit Del Monte Foods Inc.’s loans at a discount in the secondary market, Del Monte would have incurred a net loss of $3.7 million against a profit of $1.2 million on year.

Del Monte said revenues in the three-month period ending July 31, 2018 fell 7.7 percent to S$437.23 million mainly due to lower sales in the US and lower exports of processed pineapple.

DMFI contributed $308.3 million or 71 percent of the total group sales. Sales, however, declined eight percent on lower volume across categories, most significantly branded tomato products and private label, as well as the lower pricing in foodservice for pineapple juice concentrate.

Sales in the Philippines domestic market were flat in peso terms and down 5.3 percent in US dollar terms due to the weak local currency.

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Sales of the S&W business also declined in the first quarter period mainly due to lower sales in North Asia and Turkey. 

Barring unforeseen circumstances, Del Monte said it expects to be profitable for the fiscal year 2019 on a recurring basis.

The company plans to strengthen the core business and focus on growing broadened business for the remainder of the year, while reducing non-strategic and non branded business categories.

It also pans to improve the financial performance by reviewing the manufacturing and distribution footprint in the US to increase operational efficiency, reduce cost and raise margins.

It committed to increase cash flow, strengthen the balance sheet and reduce leverage and interest expense. 

Meanwhile, Del Monte said it remained keen on listing the Philippine subsidiary, Del Monte Philippines Inc., in the Philippine Stock Exchange.

“The IPO (initial public offering) was deferred in June due to volatile market conditions. The company will announce when it relaunches this as the equity markets improve,” it said.

Del Monte plans to sell approximately 20 percent of its stake in DMPI to raise as much as P13.5 billion in proceeds.

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