D&L Industries Inc., a major producer of customized food ingredients and oleochemicals, has raised its profit guidance for this year after reporting much higher first-half results.
In a press briefing held in Makati City, Alvin Lao, D&L president and chief executive officer, said the company has raised its profit guidance growth for this year from 10 percent to between 15 and 19 percent.
“Seeing our first quarter and first half, we are revising our guidance upward to the mid to high teens,” Lao said.
“For as long as our economy continues to grow stronger, and I think this is because of the political environment, we could grow at that pace in the next few years,” he added.
D&L’s net income grew 22 percent to P1.26 billion in the first half from P1.03 billion in the same period last year, while recurring net income rose 17 percent.
Lao noted that traditionally, the second half of the year is usually more favorable to the company earnings-wise.
First-half revenues were up 8 percent on higher sales volume across all businesses and partially from higher commodity prices in the second quarter, particularly of coconut oil.
Lao said the company continues to make good progress moving into the high-margin specialties, with double-digit growth in volume sustained in the first six months of the year, supported by a strong product pipeline of specialty ingredients, oleochemicals, and aerosols.
The company is also in the final phase of supplying specialty oils and specialty ingredients to the customers of US food giant Ventura Foods in the Asia Pacific region, which was in line with the agreement entered into by the parties in 2014.
“We should begin supplying to these new customers by the end of the year,” said Lao.
With the huge potential of the Ventura business, Lao said the supply agreement is expected to propel D&L’s exports and accelerate the achievement of their export target.
Exports account for 50 percent of the company’s total revenues.