CIIF-Oil Mills Group revenues up 21%

MANILA, Philippines - Government-sequestered CIIF-Oil Mills Group (CIIF-OMG) posted a 21 percent increase in revenues to P9.1 billion in the first half of the year despite a sharp drop in copra production.

The company’s income from operations reached P81 million in the first semester of the year.

CIIF-OMG further reported that it has a position gain (or inventory that was already contracted but not yet delivered) of P91 million as of July, putting its total income from operations at P173 million as of July.

Jesus L. Arranza, recently reappointed president and chief executive officer of the CIIF-OMG, attributed the increase in gross revenues and income to the high value of copra in the international market and the effective trading strategy that was instituted by the management.

“Despite lower volume, revenue has gone up due to high prices of the commodity and trading was properly managed. This situation (of low copra production) we are in right now is far worse than what happened in 2005 to 2007 when the company incurred about P1.5 billion in losses,”Arranza said.

The CIIF-OMG recorded sales of 164,148 metric tons in copra terms in the first half of the year, 49 percent lower than the 323,257 MT sold in the same period last year.

However, the management’s trading strategy allowed the company to take advantage of the huge jump in the selling price of coconut oil to $1,800 per MT from last year’s $772 per MT.

“There is now a gradual increase in the supply of copra and we hope this will continue until the end of the year and even up to the first quarter of next year, which happened also in 2010. This will definitely increase our capacity utilization and sales, and increase our revenue and income from operations further for the rest of the year,” Arranza said.