CIIF-Oil Mills Group posts 17% revenue hike

MANILA, Philippines - Government sequestered CIIF-Oil Mills Group (CIIF-OMG) announced a 17-percent increase in revenues in 2011 due to management’s effective trading strategy that allowed the company to navigate through sharp drops in copra production last year.

Jesus L. Arranza, president and CEO of CIIF-OMG, reported that the firm’s gross revenues rose to P16.65 billion last year from P14.187 billion in 2010.

This allowed the group to post a consolidated gross profit of P1.014 billion, 12 percent higher from 2010’s P909 million, and six percent above the 2011 full-year target of P961 million.

Arranza said CIIF-OMG’s income from operation jumped to P220 million in 2011, a 29-percent increment from 2010’s P171 million. The 2011 operating income also surpassed the company’s target of P209 million by five percent.

CIIF-OMG performed strongly in 2011 despite the huge drop in copra production in the country. Due to low copra supply, its total purchased/received copra for the year dropped 35 percent to 254,318 metric tons (MT). This was way below the company’s expectation of 458,000 MT for 2011.

With this, its total copra crushed including tolling production for 2011, fell 44 percent to only 295,138 MT.

“Despite the fact that copra was so short, the CIIF-OMG made money because we were prudent in our selling. We did not enter into forward contracts that might end up incurring losses. Being a sequestered group of companies, management has to be very prudent to make sure we are able to preserve the assets of the CIIF-OMG and, at the same time, generate profit despite factors that are not conducive to business,” Arranza said.

He said the conglomerate is bullish of its prospects for 2012, particularly since they expect crude coconut oil (CNO) prices to go up further in the world market.

“We are also optimistic that the CIIF-OMG Board, composed of very competent people from different business disciplines, will be able to set the right strategies to continue our turnaround from a conglomerate that incurred P1.5 billion in losses from 2005 to 2008 under the previous management to a profitable sequestered firm. We also get constant guidance and support from PCGG chairman Andres Bautista, who has been very proactive in the formulation of our business plans,” Arranza said.

The six CIIF OMG companies are: Legaspi Oil Co., Inc., San Pablo Manufacturing Corporation, Granexport Mfg. Corp., Cagayan de Oro Oil Co., Inc., Iligan Coconut Industries, Inc. and Southern Luzon Oil Mill, Inc.