Food ingredient and plastics manufacturer D&L Industries Inc. said it expects net income to exceed P1 billion in the second half as the domestic economy continues to recover following the government’s move to ease quarantine restrictions.
D&L president Alvin Lao said in an interview following the annual stockholders’ meeting the non-food business, which accounted for a significant portion of the group’s earnings, saw a faster recovery than initially expected.
The food business is also picking up even as dine-in sales remain weak and people are reluctant to eat in restaurants because of the pandemic, he said.
“Second-half profits would be more than P1 billion as indications are it would be better than what we thought,” Lao said.
He said while Metro Manila reimposed the more stringent modified enhanced community quarantine for two weeks in August, most customers remained open as they were better prepared this time.
Lao said D&L’s customers were able to generate revenues by tapping online sales and delivery channels. The oleo-chemical business is benefiting from increased mobility which translated into bio-diesel sales while specialty plastics rebounded with the reopening of the global economy which lifted sales to export-oriented automotive companies.
The pandemic accelerated the adoption of the health and wellness trend, allowing sales of specialty products related to personal care, organic cleaning products and disinfectants to grow.
Demand for plastics used for packaging enjoyed stronger demand as consumers preferred using single-use plastics over washable items because of sanitation, the company said.
“The third quarter is definitely better than the second quarter where operations of some customers were practically zero,” Lao said.
“The fourth quarter will be hard to say because there may not be Christmas parties although new COVID-19 cases are not rising while there seems to be fewer serious cases than before,” Lao said.
D&L is constructing a new manufacturing plant in Batangas and expects to complete it by end-2021.