Del Monte Pacific recovers from losses, records $12m profit
Operational improvements did their magic.
Del Monte Pacific Ltd reported a profit for the quarter ending in January, reversing losses incurred in the previous period.
For the past quarter, Del Monte achieved an US$8.46m ($12m) net profit, on the back of strong sales in Asian markets particularly in the Philippines and the operational efficiency improvements resulting in cost reduction.
Overall sales were US$604m, slightly higher than in the prior-year period as strong sales in Asia offset lower sales in the United States.
"We continue to build on the consumption-driven growth in Asia as our team optimises opportunities in both the retail and foodservice sectors,” said Joselito Campos, Jr, managing director and Group CEO of DMPL.
The Group’s US subsidiary, Del Monte Foods, Inc (DMFI), contributed US$450.6m or 75% of Group sales. US sales declined by 3% versus the same period last year driven by the continued weakness in the canned fruit industry, lower sales of regional brands in the packaged vegetable category across retail and foodservice due to supply-related issues, and lower sales of private label.
“Our US business continues to be impacted by shifting consumer preferences, and our performance in the foodservice and private label sectors. We are implementing a strategy based on innovation and differentiation in existing categories, whilst seizing opportunities in other categories and channels to address consumer demands,” Campos explained.
However, amidst industry contraction, DMFI increased its market share in two of the four major categories in retail, i.e. packaged vegetable and broth, which was further supported by the growth of the branded business amongst major retail customers.