DEL Monte Pacific Ltd. (DMPL) said Tuesday that it was optimistic about growth prospects for its fiscal year ending April 2025 given positive developments in its base business in the Philippines, where it will soon celebrate its 100th year of operations.
“[W]e are seeing good momentum and recovery from a number of areas,” DMPL Chief Financial Officer Parag Sachdeva told investors and analysts, adding that the Philippines was showing good trends, particularly on the retail side.
“Our Fresh business has continued to be very strong in fiscal 2024 … and our growth and investments in that business continue,” he added.
Sachdeva said the profit leaks that impacted the company in the last couple of years — from extraordinary supply chain situations post-Covid to higher inventory-related waste and warehousing and distribution costs — were hopefully over.
“We are seeing improvement in our margin and profitability as we see the back of that, and a lot of effort [is] being put in terms of bringing back or restoring the productivity of our plantation, which obviously was a major factor in terms of our lower gross margin on the processed food business and also on our beverage business,” he explained
The company is also currently addressing two key issues where it is making progress, DMPL Chief Operating Officer Ignacio Sison said
Sison noted that in the Philippine market, the general trade channel was weak in the past fiscal year, but “we have been able to find ways to resuscitate this with increased competency and new people managing the business.”
DMPL is also “increasing the coverage of our distributors so that we are able to address the growing demands of the business, particularly the new products that we have in the market, and there will be new products,” he continued.
Noting the lower output of their C74 plantation last year due to the La Niña phenomenon, Sison said: “We’re cycling off that now, and we should recover by 2026, so two years to recover, but good to note that this year is a much improvement versus last fiscal year.”
“We are also looking at restoring the levels of productivity, starting 2026 and all through our long-range plan, all the way to 2028,” he added.
Meanwhile, Sachdeva said that DMPL expected to raise around $300 million in FY 2025 through a combination of private placements or sale of assets mainly in the US, which are already in progress. The asset sale, he said, will focus on brands and plants that are better off sold and are easier to divest.
DMPL shares added 8 centavos to close at P4.90 each on Tuesday.
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