Fruit grower and canner Del Monte Pacific Ltd. posted a net profit of $51.53 million in fiscal year ending ending April this year, a turnaround from a loss of $43.17 million in 2015.
Del Monte said in a disclosure to the stock exchange the net income was boosted by one-off net favorable adjustments of $31.7 million after tax mainly due to Del Monte Foods Inc’s retirement plan amendment in the second quarter and the working capital adjustment in the fourth quarter. The adjustments offset expenses from the closure of a plant in North Carolina.
Minus the company’s non-recurring items, core net income in 2016 stood at $19.8 million, a significant improvement from the loss of $43.2 million last year.
“During the past year, we continued to lay the foundation for future growth and this is reflected in the sales and financial performance of Del Monte Pacific in FY2016,” said Joselito Campos Jr., managing director and group chief executive officer of DMPL.
“We drove improvements in our cost structure and better aligned operations with our strategic direction to gain market share, increase margins and expand into adjacent categories as part of a long-range plan to grow sales and profits for the company in the years ahead,” Campos said.
The group registered full-year sales of $2.3 billion, up four percent from a year ago.
Unit Del Monte Foods, which accounted for 78 percent of group sales, generated revenue of $1.8 billion.
The Philippine market delivered a record performance for the full year with sales up six percent, as all product categories—packaged fruit, beverage and culinary–posted higher sales, driven by an expanded user base and household penetration.
Barring unforeseen circumstances, Del Monte said it expected the company to remain profitable in 2017.
The company plans to improve its financial performance in the short-to- mid term period by strengthening its core business, leveraging procurement synergies and optimizing costs.
The group plans to shift to a leaner organization model in the US to drive channel growth and reduce costs.