MANILA, Philippines - San Miguel Purefoods Co. Inc., the food arm of diversifying conglomerate San Miguel Corp., reported a 26 percent jump in its first half net earnings this year to P541 million on higher sales and contained costs.
Company chairman Eduardo Cojuangco Jr. said revenues reached a record P71.1 billion, an increase of 12 percent from the year earlier level, helped by steady volume and revenue increases across most of its businesses.
Favorable selling prices likewise boosted Purefoods’ revenues in spite of higher raw material prices and shrinking disposable incomes.
While the feeds, poultry and dairy businesses posted strong results, the Food Group’s basic meats segment was weighed down by higher input costs.
“Our ability to maintain our market leadership in many different food categories relies on anticipating changing trends and understanding the consumer behavior from various income ranges. We constantly review our product portfolio and find ways to offer quality and affordable products that are relevant to their needs,” Cojuangco said.
Purefoods vice-chairman Ramon S. Ang said the company expects to rake in revenues of P80 billion by yearend. Last year, the company registered revenues of P71.08 billion. He expects the second half to be better than the first because of continued cost reduction initiatives being implemented by management as well as more stable prices.
“We are already implementing actions that should generate stronger profits for our food business, particularly in the second half. We’re going to continue to manage higher input costs through pricing actions and operating excellence and we have made progress in several important areas of our company, particularly product innovation, more effective marketing and distribution and manufacturing efficiencies,” Ang said.
In April, the San Miguel conglomerate announced it has allotted P9.93 billion for its food group expansion program, P1.5 billion of which will be used to cover Purefoods’ capital requirements for this year.
The Magnolia poultry farm expansion program will get P3.37 billion to raise its production of 188 million birds to 213-million chickens.
Around P4.89 billion will be chanelled to Monterey hog farm to increase production of 38, 765 sows to 48,765 sows.