CONCEPCION Industrial Corp. (CIC), the listed maker of aircon and refrigeration appliances, intends to increase its sales and profit fivefold under an expansion plan toward plans 2020.
The company intends to make this happen by forging partnerships, joint ventures and internal synergies, President and CEO Raul Joseph Concepcion said in a press briefing after the company’s annual stockholders’ meeting on Wednesday.
“To be able to grow five times toward 2020, we should be able to grow by 20 percent to 30 percent year-on-year,” Concepcion said.
This year, however, Concepcion sees slower sales and profit growth of 10 percent to 15 percent. He cited the after effects of the port congestion that has shaken the company’s operation. The port congestion, which started in early 2014, was declared officially over by the government early this year.
In the same briefing, Chief Financial Officer Victoria Betita said the 2020 growth plan would not be capital expenditures-driven as it is anchored on the CIC tradition of partnering with allied companies.
“If you look at our expansion points, we are really geared towards forming alliances, looking at aligned companies to be able to grow,” Betita said.
Over the past few months, CIC expanded into home appliances through a joint venture with Conception Midea and moving equipment via Concepcion Otis.
The company’s revenue mix consists of 70 percent from the consumer segment, 25 percent from its building and industrial business, and 5 percent from after sales service.
“By 2020, you will see a shift maybe 60-30-10: 60 percent for consumer, 30 percent for industrial and 10 percent for after sales,” Concepcion said.
CIC’s unaudited 2014 net income was up 23 percent to P628 million from P511 million a year earlier. Net sales grew by 21 percent to P9.2 billion from P7.6 billion. The company accounts for 30 percent to 35 percent of the appliances market.