Food ingredients manufacturer D&L Industries Inc. said it expects net income to increase by at least 10 percent this year as it expects volume and exports to maintain their growth momentum.
D&L president Alvin Lao said in a press briefing company said it expects the growth of high margin specialty products to remain within the average of 7 percent while the share of exports to total revenues is expected to continue grow from the current 25 percent.
“There is a lot of optimism among our customers right now in terms of number of stores that are going to open and also in terms of expansion plans. They are very positive and so we are also positive and that is why we expect to maintain a double digit growth. There is a lot of confidence right now,” Lao said.
D&L in 2017 posted a recurring net income of P2.9 billion, up 10.6 percent from P2.63 billion in 2016.
Fourth-quarter alone earnings and volume growth continued to pick up following lackluster expansion in the first half of the year.
Net income in the fourth quarter of 2017 increased 12 percent year-on-year to P786 million.
“We rounded off 2017 with double digit growth, showing full recovery from a tough start to the year. We see that our full year results better reflect the long-term growth prospects of the business. Going forward, we will continue to exercise discipline and excellence in R&D as we continue to target opportunities in the growing Philippine economy, as well as in our rapidly expanding export segments,” Lao said.
Export sales jumped 68 percent in 2017 to P6.83 billion with the company’s partnerships with Ventura and Bunge maintaining their pace. The food ingredients segment currently accounts for 45 percent of total exports, significantly higher that just 19 percent in the full year of 2016.
D&L said growth prospects for exports remained healthy, given Ventura’s low penetration in the region and several opportunities in the market.
The contract with Ventura covers the entire Asia Pacific, with four countries—China, Hong Kong, Japan, and Indonesia—only being served to date.