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MANILA, Philippines – San Miguel Pure Foods Company Inc. (PSE:PF) reports a robust 29 percent net income growth for the nine-month period of 2016.
The company credited its higher net income to its strong Branded Value-added businesses, lower raw material costs, improved efficiencies, and expanded distribution among others.
The company’s net income is 29 percent higher than its record last year at P3.8 billion. Meanwhile, the consolidated revenues climbed by five percent at P80.6 billion.
During the first two quarters of the year, the company already posed a strong performance with its consolidated sales revenue increase by five percent at P53.2 billion.
The robust two-quarter performance is mainly driven by the higher compensation for the election last May. In addition, the two initial quarters of 2016 also booked a higher operating income and net income. The former reported a 31 percent increase at P3.6 billion, whereas the latter had 37 percent climb at P2.5 billion.
Global wheat prices decreased along with the market competition, which also resulted to lower selling prices. The company was also affected in the third quarter with its milling business revenue drop of four percent.
Since the end of two quarters in 2016, milling business is largely affected by lower wheat prices. As a response, the company decided to focus on customized and specialty premixes sales, which generate steady margins and bound wheat price movement impact.
SMPFC is a subsidiary of San Miguel Corp. responsible for manufacturing and marketing processed meat products. Operations of livestock and poultry were also handled by the management. Other manufacturing and distribution segments of SMPFC involve dairy, coffee, feeds, flour, young animal ration, and franchise operations among others.
Popular brands under SMPFC are Magnolia chicken, Monterey Foods, San Mig coffee, and Magnolia ice cream.
As of 2:18pm of November 10, 2016, PF is trading at 220 per share, which is 0.92 percent higher than yesterday’s closing price.