Noodle and snack food maker Monde Nissin Corp. said it earmarked P7.21 billion for 2024 capital expenditures, nearly double the P3.64 billion it spent in 2023.
Monde Nissin said this year’s capital expenditures would focus on building capacity and capability of its Asia-Pacific branded food and beverage (APAC BFB), which posted a 12.6-percent increase in sales to P65.9 billion.
Around P6.21 billion will be spent by APAC BFB out of the programmed capex this year, while only P1 billion was budgeted for its struggling alternative meats business.
Monde Nissin chief executive officer Henry Soesanto said the capex spending would be funded through operating cash-flow.
Soesanto said the company has several expansion projects for its food and beverage business and is completing a new production plant in Davao that will expand its bakery and biscuit.
“We are working on some project that we cannot divulge at this point. But a lot of is in our bakery business, like biscuits and cakes. We need to catch up capacity in order for us to serve the volumes that our customers are demanding,” Soesanto said.
Monde Nissin last week reported that its board approved a move to reallocate P228.8 million of its unused initial public offering (IPO) proceeds as capex funds this year for the company’s APAC-BFB segment.
Meanwhile, Soesanto said Monde Nissin was also expecting a low single-digit revenue growth in the first quarter for its APAC-BFB business.
“During the first quarter, we expect low single-digit revenue growth, partly due to the timing of the Holy Week holiday in the Philippines, and a robust gross margin improvement of more than 600 basis points (bps) year over year and more than 300 bps sequentially,” he said.
Monde Nissin posted a net loss of P626.58 million in 2023 after it book P10.1 billion in non-cash, non-operating impairment in its alternative meat business.