Century Pacific first-half net income rose by 6%

MANILA, Philippines — Century Pacific Food Inc. (CNPF) grew its first-half net income after tax by 6 percent to P4.1 billion, as sustained demand for its branded products and a rebound in export sales offset a tougher operating environment.

The canned food maker said on Thursday its consolidated revenues climbed 15 percent year on year to P45.8 billion, driven by double-digit growth from both its branded and original equipment manufacturer (OEM) exports businesses.

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“Our operating conditions in the first half were far from smooth. Fuel prices soared, squeezing our consumers while adding pressure to our operating costs,” said Chad Manapat, CNPF chief financial officer.

“We proactively tightened spending while also rolling out measured pricing action well below inflation, aiming to strike a balance between cushioning rising costs and keeping our goods within reach for our consumers,” Manapat said.

The branded business, which accounts for the bulk of CNPF’s sales, expanded 13 percent in the first half after accelerating to 14-percent growth in the second quarter.

The company said demand improved across all major categories, with its milk, coconut and other emerging businesses leading the gains.

Meanwhile, OEM tuna and coconut exports rebounded from a weak base last year, posting a 26-percent growth as tuna export markets improved and global demand for coconut products remained strong.

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READ: Century Pacific sustains double-digit profit growth

Gross margin improved by 20 basis points to 25.9 percent, offsetting a similar increase in operating expenses as a share of sales. This allowed operating income to rise 15 percent, in line with revenue growth.

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However, higher finance costs from increased short-term borrowings and the expiration of tax incentives tempered earnings growth.

Excluding one-off provisions related to earthquake damage that are still subject to insurance claims, core net income after tax increased 10 percent. Core operating income grew 18 percent, underscoring the resilience of the company’s underlying business.

Looking ahead, CNPF said it remains committed to sustaining double-digit growth.

The company plans to spend about P8 billion in capital expenditures this year. INQ