August 17, 2007

 

Philippines' Alaska Milk profit sharply up by 156 percent

 

 

Philippine dairy firm Alaska Milk Corporation reported a surge of 156 percent increase in net income in the first half, but warned that the industry would continue to grapple on tight global supplies into next year.

 

Company president Wilfred Steven Uytengsu Jr. said Alaska Milk net income reached P399 million in the first half, up 156 percent from P156 million (US$8.5 million) in the same period last year, due mainly to increased sales and selling prices.

 

Net sales rose 45 percent to P3.96 billion from P2.74 billion, he said.

 

However, Uytengsu said the dairy industry will continue to face increased raw material costs due to supply constraints and a sharp rise in milk demand in China. He said prices of skimmed milk powder have more doubled from its price last to over US$5,000 per tonne. He said "current imbalance in supply and demand will be seen through to 2008 and beyond".

 

Affecting raw material supply is the worst drought in a century in Australia, the top supplier of milk to the world market, he said.

 

Supply from New Zealand, another major source of milk, has also suffered from record-low herd sizes, he said.

 

Going forward, Uytengsu expressed optimism on Alaska Milk's prospects.

 

On top of higher selling prices, the company has also benefited from the additional revenues from its acquisition and licensing of several liquid milk brands from Nestle earlier this year, he said.

 

Uytengsu said the acquisition gave Alaska Milk a 90 percent of the Philippine dairy market, almost double its old market share.

 

US$1 = PHP46.43 (as of August 17, 2007)