MANILA, Philippines - Chemrez Technologies Inc., the country’s largest producer of environment-friendly oleochemicals and resins, has reported a 26-percent growth in consolidated sales for the first nine months of the year to P4.5 billion from the P3.6 billion recorded for the same period in 2009.
In a disclosure to the Philippine Stock Exchange, ChemrezTech said sales volume was up eight percent compared to the same period last year.
The company said a quarter of this increase came from exports, driven by the high demand for amides and esters as used for the detergent and soap sectors in overseas markets.
Gross profit for the period went up by two percent to P584 million from P569 million a year ago.
Meanwhile, ChemrezTech’s various resin products have registered mixed volume results.
The revenue mix, the company said, is 58 percent oleochemicals, 38 percent resins, and four percent powder coating.
“Overall, despite the very tough competition, we have been able to maintain a leading market share in the industries we are in,” ChemrezTech said.
For the period under review, the company’s gross profit for the period improved by two percent to P584 million from P569 million in the same period in 2009 even as the company was unable to increase prices while raw material costs increased.
Gross profit margin is 13 percent in 2010 while it was 16 percent last 2009.
“We have very tough competition in almost all industries we are in. Higher cost of sales without a corresponding sales price increase resulted in gross profit increasing by only two percent despite a 26- percent sales increase,” ChemrezTech said.
Selling and marketing expenses increased by 18 percent from P61.6 million in 2009 to P72.9 million in the period under review. The increase in selling expenses was mostly due to the significant increase in delivery expenses which, in turn, resulted from the increase in sales volume.
Administrative expenses increased by 10 percent from P55.2 million in 2009 to P60.5 million this 2010.
Other income, which consisted mostly of foreign exchange gains, increased 11 times due to the weakening of the dollar against the peso which was favorable for the company.
Its net profit margin, on the other hand, decreased to nine percent from 10 percent; while earnings per share for the period slightly increased to P0.29 from P0.28 for the same period in 2009.
ChemrezTech’s retained earnings increased by 21 percent from P1.1 billion at the end of 2009 to P1.3 billion, due to the profit generated for the period.