Del Monte posts USD2.8-M net loss

DMPL, listed in both the Singapore and Philippine stock exchanges, said it incurred USD23.6-million one-off expense after divesting its underperforming Sager Creek vegetable business. (Wikimedia commons, Fair Use)

MANILA — Food and beverage conglomerate Del Monte Pacific Limited (DMPL) booked a net loss of USD2.8 million in the second quarter ending October 2017, reversing its USD20 million profit last year, as it rationalized plants and invested in brand building.

DMPL, listed in both the Singapore and Philippine stock exchanges, said it incurred USD23.6-million one-off expense after divesting its underperforming Sager Creek vegetable business.

It also invested in trade and marketing to strengthen its business in the United States , which was reflected in the higher volume achieved.

Without this expense, the Group would have generated a net income of USD10.2 million.

DMPL said it achieved second-quarter sales of USD624.7 million, slightly 1.8-percent lower than last year, due to lower sales in the US which were affected by unfavorable pricing in foodservice and USDA, and higher planned trade promotion spending.

Its US subsidiary, Del Monte Foods, Inc. (DMFI), contributed USD485.6 million, or 78 percent of Group sales.

The Group’s second largest subsidiary, Del Monte Philippines, Inc. (DMPI), generated sales of USD134.0 million, up 2 percent against the same quarter last year.

Sales in the Philippines, the largest market of DMPI, were up in peso terms on better sales of packaged fruit as well as the food service channel. DMPI’s sales comprise Philippines sales and exports.

DMPL said food service sales continued to grow, riding on the rapid expansion of quick service restaurants and convenience stores with partnerships and menu creation with major accounts.

Meanwhile, DMPL commenced a USD80-million Series A-2 preference shares offer, with an oversubscription option of up to USD80 million, to raise more equity and repay loans.

The offer period started Nov. 28 and will run until Dec. 8. The listing set for Dec. 15 on the Philippine Stock Exchange (PSE).

DMPL raised USD200 million from the first tranche offering of preferred shares, which were listed at the PSE on April 7. (PNA)