FOOD conglomerate Del Monte Pacific Ltd. (DMPL) swung to a net loss in the three months ending January 2018 due to one-off expenses related to the shutting down of plants in the US and the write-off of deferred tax assets.
DMPL told the Philippine Stock Exchange on Thursday it incurred a net loss of $38.4 million in its fiscal third quarter, a reversal from the $8.5 million profit recorded in the same period last year. For the first nine months, it booked a net loss of $40.4 million versus the $21.5 million profit a year earlier.
Excluding one-off expenses, the company said it would have booked a $3.4 million net income versus the $11.6 million year-on-year.
US subsidiary Del Monte Foods, Inc. (DMFI) contributed $451.5 million or 75 percent to the group’s total sales, up by a marginal 0.2 percent from its contribution last year.
DMFI booked an additional one-off expense worth $6.8 million in the third quarter. On a non-cash basis, it wrote off $39.8 million of deferred tax assets due to the change US Federal income tax rate from 35 percent to 21 percent.
Total one-off expenses for the third quarter alone amounted to $41.8 million post-tax.
The group’s sales for the quarter slipped 0.7 percent to $599.8 million primarily due to lower exports of processed pineapple.
For the first nine months, DMPL generated sales of $1.7 billion, marginally lower than the prior year.
The group’s second largest subsidiary, Del Monte Philippines Inc (DMPI), generated sales of $420 million, higher by 8 percent in peso terms and 2 percent in US dollar terms versus the same period last year. DMPI’s sales are composed of Philippines sales and exports under the S&W brand and private label.
Sales of its S&W business declined in the third quarter period, mainly due to lower packaged pineapple sales in North Asia.