MANILA, Philippines – Listed food conglomerate Del Monte Pacific Ltd. incurred a net loss of $12 million in the first quarter of its fiscal year ending April 2016.
The Singaporean and Philippine listed company attributed the net loss to the traditionally weak first quarter and the El Nino dry spell in the Philippines that affected pineapple production.
The Del Monte Group, however, registered a six percent increase in sales to $472.8 million.
Sales of US-based subsidiary Del Monte Foods Inc. rose 10 percent while sales of Del Monte Philippines went up seven percent, mainly driven by increased demand for packaged mixed fruit and beverage.
“As we continue to unlock the growth potential of our products, accelerate our penetration of the food service sector and ethnic Asian market as well as enter new vegetable segments, our results will improve further,” DMFI CEO Nils Lommerin said.
DMPL managing director and CEO Joselito Campos Jr. expects to swing to profitability next year.
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“We have successfully laid a solid foundation from which we will execute our growth plans in the coming quarters. Barring unforeseen circumstances, we look forward to a return to profitability in FY2016, which will generate more free cash flow to allow us to deleverage further,” Campos said.
Sales of Del Monte’s SandW brand in Asia and the Middle East rose 10 percent during the period on strong demand for fresh pineapple exports, which offset weakness in the packaged segment as a result of constrained supply.
DMPL’s share of loss in the FieldFresh joint venture in India, meanwhile, was lower at $0.4 million during the period from 0.6 million a year earlier due to the robust performance of Del Monte packaged business, primarily led by improved volume in canned juice, olive oil and pasta.