September 22, 2003



Philippines Poultry Gets US$1.36 Million From Swift


Listed Philippines poultry firm Swift Foods, Inc. has named its price for an optimal productive Cagayan de Oro plant - PhP75 million or US$1.36 million.


Swift President and Chief Operating Officer Luis Bernardo A. Concepcion said this would allow the plant to expand with burgeoning consumer needs in fast food.


"The plant is currently running at 75% capacity. We will maximize the facility to be able to get more accounts. Because of the tremendous orders, we need to pump in PhP75 million to grow further," Mr. Concepcion said.


The US$4.53 million plant in Cagayan de Oro has a daily output of 35 tons of dressed chicken, with a client base that includes Jollibee, Kenny Rogers, Wendy's Hamburgers, and Kentucky Fried Chicken.


Expanding the plant


Mr. Concepcion said a better facility would push output towards 50 tons of poultry daily. 25 percent of the expansion's financial needs will be borne by an unnamed partner, he revealed.


Poultry products from the Cagayan de Oro plant are shipped to Manila via refrigerated vans. "This is the beginning of tapping what Mindanao is -- as the food basket of the country. It has the (right) climate and no other region in the Philippines can grow world-class produce," Mr. Concepcion said.


He added that increasing Swift's output for fast food clients would help the company tackle the bouts of high and low demand characteristic of the industry every five to six years.


"We are positioning to get out of the cycles by satisfying the food service sector -- the fastest growing industry with a steady income and fair return every month," Mr. Concepcion said in his address to Swift shareholders during the firm's annual meeting last Friday.


He said while business has been picking up in the second half of the year, weak sales in the first semester would still result in losses by year end. Revenues for the year could reach US 80 million but losses early this year would likely result in a US$2.72-million deficit for 2003, he added.


However, the company is expecting a better performance next year due to lowering operating costs and better service through fast food service accounts.


Swift is targeting to spend only US$4.65 million this year, from almost US$11 million last year Mr. Concepcion said the company is right on track with expenses as it spent only US3.04 million in the first half.
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