Del Monte Pacific swings to profit in 1st quarter

DEL MONTE Pacific Limited (DMPL) swung back to profit in the May to July period, as strong sales in the Asian and Middle East markets offset the softer performance in the United States.

The canned fruit giant on Thursday told the stock exchange it posted a net income of $740,000 for first quarter ending July, reversing the $7.04 million net loss recorded in the same period a year ago. Del Monte Pacific’s fiscal year ends in April.

Del Monte Pacific’s sales went up 1.4% to $473.8 million for first three months of its fiscal year 2018 “due to the strong performance of its S&W brand in Asia, partially offset by lower sales in the USA.”

Its US subsidiary, Del Monte Foods, Inc. (DMFI) accounted for $336.5 million or 71% of the group’s sales. However, DMFI’s sales fell by 4.1% as the performance of its private label and regional brands in food service, as well as fruit and pineapple concentrate, were affected by lower prices of its competitors.

On the other hand, sales of its second biggest subsidiary, Del Monte Philippines, Inc. (DMPI) jumped 14% year on year to $131.4 million.

“The Philippine market sales were up 5.1% in peso terms but down 1.5% in US dollar terms due to peso depreciation. Sales growth was driven by expanded penetration and increased consumption of packaged pineapple fruit following improvement in supply, coupled with higher sales of culinary products,” Del Monte Pacific said.

Del Monte Pacific said its S&W branded business continued to grow, with sales in Asia and the Middle East up by 71% in the first quarter “due to strong sales of fresh pineapple on the back of improved supply and expansion into Turkey, a new market for packaged products.”

“Our business in Asia continued its strong momentum in the first quarter driven by DMPI’s growth through S&W’s significant progress as it expanded its business in existing markets and broke ground in new markets. In the Philippines, we continued to drive increased consumption frequency, amongst a wider base of consumers through sustained investments in advertising, product innovation and expanded trade availability,” DMPL Chief Executive Officer and Managing Director Joselito D. Campos, Jr. said in a statement.

The company said that it looks to deliver a profitable period for fiscal year 2018 on a recurring basis.

Shares in DMPL were unchanged at the Philippine Stock Exchange at P11.32 apiece on Thursday. The company’s shares are also traded in the Singapore Stock Exchange. —