RFM profit climbs 10%

MANILA, Philippines - Stronger sales of high-margin products in the second quarter allowed food and beverage firm RFM Corp. to post a double-digit income growth in the first semester.

In a regulatory filing, RFM said its first half net income climbed 10 percent to P427 million as sales revenues rose five percent to P4.99 billion.

RFM president and CEO Jose A. Concepcion III said despite operational issues, the company improved its profitability as higher-margin core businesses performed better in the second quarter.

Concepcion said RFM could have posted stronger growth if not for the operational bottlenecks caused by the Manila truck ban and severe Manila port congestion. RFM was hit by the shortage of delivery trucks, adversely affecting the supply chain.

“The company was also able to manage its operating expenses, while cost of certain critical inputs were also tracking lower than previous periods,”  Concepcion said.

 “We also saw double-digit growth in our major consumer brands, and we shall continue to prioritize our efforts in these categories,” he said.

Sales were more robust in the second quarter compared with the January to March period when RFM’s earnings rose 8.4 percent to P167 million.

“We expect even better numbers as we go to the second half of the year, which is usually the stronger half,” Concepcion said.

He added that the port congestion and trucking issues should also be resolved to bring back normalcy in the flow of goods and lower the cost of operations.

“For RFM, we remain bullish on the market leadership strength of our core brands Selecta and Fiesta, and now with the Royal pasta brand which has put in greater value to the RFM business portfolio,” Concepcion said.

Early this year, RFM strengthened its foothold in the pasta segment with the acquisition of the Royal brand and pasta business of Anglo-Dutch consumer goods giant Unilever Group for P2.1 billion.