The country’s largest food canner Century Pacific Food Inc. on Thursday said its income rose by more than a fifth to P1.93 billion last year, mainly propelled by the expansion of its branded business.
Last year’s earnings were 21 percent higher compared with the P1.59 billion booked from 2014.
The company said consolidated revenues grew by 14 percent year-on-year generating P23.32 billion in sales compared with P20.44 billion in 2014.
For this year, Century Pacific has earmarked some P1.1 billion in capital expenditures, the bulk of which will be spent for plant and capacity expansion in anticipation of increased sales volumes across various segments.
Last year, it said the branded business for its products such as Century tuna and Argentina corned beef, widened by 18 percent.
Its non-branded tuna for export, however, was flat.
“Robust volume growth across our three branded segments—marine, meat and milk—continues to reflect rising Filipino purchasing power, greater demand for our products, and increased recognition of our brands,” the company’s chief finance officer Oscar Pobre said.
Sales outside Metro Manila outperformed as the company’s distribution infrastructure improved and modern retailers pursued aggressive expansion plans, the company said.
Growth in the convenience store channel was strong in light of new rollouts, it added.
“So far, 2016 has been showing similar trends with good macroeconomic tailwinds, and possibly election related spending, benefiting us during the first three months of the year,” Pobre further noted.
Gross profit margins last year remained at 26.6 percent, with gains from declines in raw material prices invested in product improvements to spur consumption. Operating margins improve as growth in operating expenses was contained.
This, along with a reduction in financing costs, increased the company’s net income margins to 8.3 percent in 2015 from 7.8 percent in the previous year.
The company said it had minimal interest-bearing debt incurred as a result of its acquisition of Century Pacific Agricultural Ventures Inc.
The acquisition, which was completed at th e end of 2015, is in line with the company’s goal to cement itself as a leading player in the faster growth, upscale, and health-conscious product categories. CPAVI is a producer of organic-certified and conventional coconut products. It will start contributing to Century Pacific starting this year.
In 2015 the company engaged into can making and cold storage with its new tin can factory, which it said is already running at full capacity, and the construction of its cold storage facilities, on track for completion in the second quarter of the year.
Both capital investments are meant to manage and reduce input costs as the company braces for further growth, it said.