MANILA, Philippines — Profits of listed sugar miller Victorias Milling Co. Inc. (VMC) rose by over five-fold in the first quarter ending Nov. 30 due to the strong performance of its businesses.
In a recent filing with the Philippine Stock Exchange, VMC said its consolidated net income amounted to P772.7 million from August to November last year, soaring by 446.76 percent from P141.32 million in the same period in 2021.
The company said its net profit margin increased from seven percent to 14 percent.
Revenues jumped by 167.53 percent to P5.49 billion from P2.04 billion as the company’s sale of goods and service income more than doubled.
Sale of goods comprised the bulk of the revenue amounting to P3.97 billion, while service income accounted for P1.52 billion.
VMC attributed the significant rise in its consolidated revenue to “higher production level due to the early start of milling, higher volume of refined sugar sold due to increased demand, higher volume of raw sugar tolled, increased power export from the cogeneration plant and higher market prices for sugar and ethanol.”
The company incurred a significant increase in cane hauling costs and manufacturing costs by 36 percent and 20 percent, respectively, due to a decline in provincial cane output that increased competition and inflation.
Higher selling costs also pushed up operating expenses by 32 percent to P227.07 million compared to P1171.7 million a year earlier.
Despite the industry challenges, VMC said its balance sheet remains strong while the company remains highly liquid.
It also has no outstanding loans as of the end of the first quarter, with its current ratio still strong at 4.2 while debt to equity ratio remains low at 0.25.
As of end of November, the company’s total assets were valued at P12.9 billion mainly comprising fixed assets, cash and cash equivalents, receivables and inventories.
Its core segments are its sugar milling, refinery, power generation and distillery operations which are heavily invested in property, plant and equipment that represent 48 percent of the total assets.
“The group continues to invest on capital expenditure aimed to upgrade the plant and improve operational efficiencies and a few major projects are expected to be implemented within this crop year,” VMC said.
For its raw sugar and molasses operations, VMC operates a raw sugar mill with a daily capacity of 15,000 metric tons (MT).
It also operates a refinery plant with a daily capacity of 25,000 50-kilogram bags and provides toll refinery services to traders and planters for their raw sugar milled by other sugar centrals to ensure maximum utilization of the refinery.
The distillery operations produce alcohol and ethanol with an actual daily capacity of 120,000 liters with molasses as the primary raw material, which is sourced from sugar operations which produce it as a by-product.
For power generation, VMC has a registered power plant capacity of 40 megawatts from renewable energy resources for wholesale of electricity to power companies, distribution utilities, electric cooperatives, retail electricity suppliers, aggregators and other customers.