Monde Nissin’s income falls 17% to ₱1.9 B in Q1

Monde Nissin Corporation reported a 17 percent drop in net income to P1.9 billion in the first quarter of the year as its meat alternative business Quorn US continues to weigh on its earnings.

In a disclosure to the Philippine Stock Exchange, the firm said its core attributable net income weakened by 11.6 percent to P1.9 billion, reflecting the decline in gross profit particularly in the meat alternative business.

Consolidated revenue for the first quarter grew 9.6 percent on a reported basis and 10.9 percent on a comparable basis to P20.1 billion due to the strong growth of its Asia-Pacific Branded Food and Beverage (APAC BFB) categories, and in particular domestic noodles.

“The meat alternative category continues to face strong headwinds. Last quarter, we discussed the steps that we were taking to right-size our U.S. business to better reflect current market realities,” said Monde Nissin CEO Henry Soesanto.

He added that, “We are now similarly addressing our U.K. business, restructuring it to better weather the current category conditions while remaining agile and ready to benefit when the market for meat alternatives eventually recovers.”

“In this effort, we are planning an equity infusion of up to GBP40 million into our UK entity, partially paying down the existing debt to better reflect the current asset value and lower interest cost, and to cover the restructuring costs,” Soesanto said.

Monde Nissin’s first quarter core gross profit declined by 5.0 percent on a reported basis and 1.8 percent on a comparable basis to P6.1 billion.

Core gross margin declined by 470 bps on a reported basis and 390 bps on a comparable basis to 30.4 percent due to elevated raw material and higher overhead costs, partially offset by price increases.(James A. Loyola)