Del Monte Philippines Inc., one of the largest food and beverage companies in the Philippines that plans to conduct an initial public offering, reported a net income of P2.6 billion for its financial year ending April 2018, slightly lower than a year ago on higher interest expense.
DMPI said in a disclosure to the stock exchange revenues rose 3.4 percent to P27.6 billion, about two-thirds of which were sales to the domestic market.
Sales in the Philippines climbed 6.7 percent to P16.9 billion, offsetting the marginal 1.9-percent decline in export sales to P10.6 billion.
DMPI is expected to post higher net income in the current year as the company is poised to reduce borrowings and interest expense through better collection from receivables.
“While DMPI’s net debt to equity ratio is only 0.7x, the company will reduce its gearing, strengthen its balance sheet further and improve its bottom line,” the company said.
The company also expects the domestic market to continue to deliver higher profits and exports to improve from better sales mix with higher fresh pineapple sales under S&W, and increased margins from pricing, cost management, and operational efficiencies.
DMPI, which has been in operation in the Philippines for over 90 years, is the market leader in the canned pineapple and mixed fruit, canned and Tetra ready-to-drink juices, tomato sauce and spaghetti sauce categories under its iconic Del Monte brand.
DMPI, which plans to raise P13.5 billion in an initial public offering, earlier deferred the maiden share offering due to the volatility in the stock market.
DMPI did not provide a new timetable for the share sale.
The company plans to sell 587.437 million in secondary shares at a price of between P18 and P23 per share.
It plans to use the net proceeds from the offering to partially repay certain loans extended by parent company Del Monte Pacific Ltd. and refinance financial obligation of the DMPL group to significantly reduce its leverage position.