November 23, 2006

 

San Miguel Purefoods income drop by 37 percent

 

 

Philippine food giant San Miguel Pure Foods Company (SMPFC) reported a 37 percent drop in net income attributable to the equity holders of the parent company to P61.28 million (US$1.23 million) in the third quarter of the year from P120.2 million (US$2.41 million) in the same period in 2005.


According to the Manila Bulletin daily, the firm disclosed to the Securities and Exchange Commission that the drop in profits was due to the decline in the combined performance of the SMPFC's subsidiaries.


Consolidated revenues rose by a modest 4 percent to US$264 million from US$251 million in the same period last year in spite of intense competition and economic pressure which dampened demand.


Improved efficiencies and cost breaks in direct material costs resulted in better margins which caused an 11 percent surge in gross profit to US$36.22 million versus last year's US$35 million.


Heavy advertising and promotions, spending for new products, higher manpower costs, distribution expenses, third party services and depreciation of newly-acquired assets increased the company's selling and administrative expenses by 15 percent to US$32.19 million from US$27.16 million.


San Miguel Food's poultry business remained the biggest contributor to revenues, sustaining its strong performance and ended the third quarter by posting 6 percent increases in both volume and revenue on account of more stable prices.


Its feeds business managed to register volume and revenue growth of 3 percent in spite of a challenging competitive scenario and a sluggish hog industry on account of various marketing programmes implemented.

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