Alaska to focus on product reformulation

Amid an increasingly difficult and uncertain business environment, the Uytengsu-owned milk manufacturing firm Alaska Milk Corp. will focus on product reformulation and explore new segments of the market in a bid to cushion the impact of rising costs on both its bottomline and topline.

At the sidelines of the company’s annual stockholders meeting yesterday, Alaska president and chief executive officer Wilfred Uytengsu Jr. said the reformulation strategy may require the reduction of the amount of milk powder that will go into the firm’s products without compromising quality.

 “We’re looking at reformulation because we recognize that with the impact of inflation, we really need to find ways to keep milk affordable,” Uytengsu said.

Uytengsu said another strategy that the company may undertake to keep its products affordable to the public is to downsize certain packaging by some can packaging into sachets to cut costs.

He pointed out that prices of tin plate have grown 40 percent year-on-year while skimmed milk powder, a key raw material for Alaska’s products, doubled in 2007 due to the imbalance in global supply-demand conditions.

Uytengsu, however, is optimistic that the company will see sustained volume and earnings growth this year with the launch of new products that appeal to various segments of the market.

 “We will continue to enhance our abiity to grow our business, strengthen our competitive position and increase opportunities that will ultimately unlock the market value of our brands as the company as well,” Uytengsu said.

Uytengsu said the company will continue implement marketing initiatives to further improve brand visibility and drive volume growth.

Aside from this, Alaska intends to explore untapped market segments and other high-growth categories of the industry with new products that are aligned with the needs of consumers.

For the first quarter this year, Alaska reported a 49.4 percent decrease in net profit to P86 million from P170 million the previous level. This is equivalent to earnings per share of P0.09 compared with P0.18 the same period a year ago.