D&L Industries Inc., a listed producer and distributor of food ingredients, specialty plastics, aerosols and oleochemicals, said on Tuesday earnings grew at double-digit rates in the first nine months of the year on the strong performance of its businesses and higher exports thanks to its Ventura Foods venture.
The company said net income after tax went up by 19 percent to P1.93 billion from P1.61 billion a year ago, while revenues jumped 10 percent to P5.95 billion.
For the third quarter alone, net income grew 14 percent from a year ago to P671 million while revenues likewise increased by 14 percent to P5.67 billion.
For the first nine months, the food ingredients business still provided bulk or 52 percent of total revenues, followed by the oleochemicals business with a 32 percent share, specialty plastics with 13 percent, and aerosols with 3 percent.
Some 18 percent of total sales were derived from exports, which grew 12 percent year-on-year to P2.85 billion boosted by its Asia-Pacific export partnership with Ventura Foods.
Alvin Lao, D&L president and chief executive officer, said in a press briefing on Tuesday that exports will continue to grow faster moving forward primarily due to the realization of the Ventura Foods distribution partnership in the Asia Pacific.
“Starting this year, we’re now selling to Ventura customers in China, Hong Kong, Japan and Indonesia. This is just the start. We target to expand to all the other countries of Asia Pacific, including Australia and New Zealand,” he said.
The company also sees a small initial contribution from its distribution deal with New York-listed Bunge Ltd. by the fourth quarter of the year. Under the deal, D&L will distribute Bunge’s softseed oils in the Philippines, while Bunge will export D&L’s coconut oil product under Farm Origin brand in Asia Pacific countries.
Capital spending in the nine months reached P226 million. Lao said D&L will retain its 15 to 19 percent growth forecast for full-year 2016 net income given the strong performance of its businesses and export expansion.
“We’re optimistic that there is indication that the country’s growth will improve. There is increased capital spending for infrastructure from 5.4 percent this year to over 7 percent at the end of this administration. The increase in infrastructure spending has an impact in everything—more jobs being created, and more goods sold efficiently and cheaper. That’s where we see growth is coming from,” Lao said.
“We’re seeing a lot of positivity from foreigners. The impression is still very positive,” he added.
D&L was established in 1963 and was listed in December 2012. Some of its major clients in the food ingredients segment are Jollibee, McDonald’s, KFC, and Nestle.