MANILA, Philippines — Del Monte Pacific Ltd. (DMPL), a Singapore and Philippine-listed company, is confident that it can pay its liabilities when they fall due, with the company seeing a return to profitability by its fiscal year 2026.
DMPL said the group’s current liabilities as of end-April have exceeded its current assets by $417.3 million, driven mainly by long-term loans that have matured and will be due within the next 12 months.
However, DMPL said its management believes that the company would be able to pay or refinance its liabilities when they fall due as the group continues to find new sources of funding to improve cash management.
According to the company, the group has new proposals from reputed financial institutions for new long-term loans and it continues to get incremental short-term lines from partner banks for meeting its short-term obligations.
“The company has been progressing discussions with partner banks for extension and/or refinancing including converting some short-term revolving facilities into long-term loans,” it said.
DMPL said its management also remains vigilant in managing its costs and is focused to restore gross margins both in the United States and rest of the company.
“The board is confident that the company will be able to meet its debt covenants and/or renew existing waivers from certain creditors. We have communicated to our partner banks that the DMPL Group’s leverage is being addressed through the capital restructuring initiatives outlined above and restoring profitability by fiscal year 2026,” the company said.
DMPL swung in the red in its 2024 fiscal year ending April, incurring a net loss of $127.3 million as compared to a net profit of $17 million recorded in the prior year.
The group still expects to incur a net loss for its fiscal year 2025 although at a reduced amount.
“Despite incurring a loss, the group generated positive cash flow from operations for the year amounting to $373.4 million, which was a turnaround from the cash outflow last year of $2.8 million mainly, driven by better management of working capital particularly inventory. We expect to see further improvement in the US subsidiary following our decision to reduce pack for most of the categories,” DMPL said.
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