Century Pacific Food net income up 31%

Canned food manufacturer Century Pacific Food, Inc. (CNPF) posted a 31% increase in its net income to P2.25 billion in the first six months of the year, due to the company’s higher consolidated revenues.

In a disclosure to the stock exchange on Wednesday, the company said its consolidated revenues rose 28% to P25.12 billion during the first half of the year while its second-quarter net income recorded a 32% increase.

CNPF said its milk brand, Birch Tree, together with its other products such as Century Tuna, Argentina and 555 sardines, continue to account for the majority of its sales, adding that its total branded businesses made up 82% of total consolidated revenues.

“Total branded saw sales grew by 35% year on year during the first six months of 2020, faster than the company’s consolidated top-line growth. In the second quarter alone, branded revenues jumped by 39% year on year,” CNPF said.

The company added that the revenues from its commodity-linked export business saw a 5% increase in the first half, and accounted for 18% of its consolidated sales.

However, CNPF said its operating expenses for the first half rose 36% to P3.24 billion due to additional funds allocated to sustain its operations despite the coronavirus disease 2019 (COVID-19) pandemic.

The company said some of the costs it incurred during the period include financial assistance to employees, provision of health and safety measures, and adjustments made to keep the unhampered flow of goods, among others.

“Though we see the pace of growth starting to ease relative to the month of March, demand continues to exceed pre-COVID levels. At this point, we are likely to end the year exceeding 10% to 15% growth — our typical growth target during more normal times,” CNPF Chief Finance Officer Oscar A. Pobre said.

But he said the company’s priorities remain, such as keeping employees safe, offering assistance to communities, and making products readily available and accessible to consumers.

“We continued to see heightened demand for our shelf-stable products through the months of April, May and June as quarantine measures and fear of going out persisted leading consumers spending more time at home and cooking their own meals,” Mr. Pobre said.

Looking ahead, Mr. Pobre said the company is planning to expand its brand portfolio that can deliver steady growth and can produce profit, as well as emerging categories that will benefit from long-term increases in income and consumption per capita.

“We are now setting our sights on more medium- to long-term plans, on how we can maximize our positioning as we invest in both our existing set of products and a robust pipeline of innovations,” he said.

On Wednesday, shares of CNPF rose 1.10% or P0.16 to close at P14.64 per share.

— Revin Mikhael D. Ochave|BusinessWorld

Source: Peso Economics