Food ingredients and plastics manufacturer D&L Industries Inc. on Wednesday reported a 35-percent jump in first-quarter net income to P695 million as all businesses registered significant recovery amid the easing of quarantine restrictions.
D&L president and chief executive Alvin Lao said in a press briefing the first-quarter net income was tracking the pre-pandemic 2019 earnings but would behind the 2018 income.
“While the business environment continues to be less than ideal, we also find ourselves, as well as many of our customers, in a much better position operationally to navigate the current situation with minimal business disruption,” Lao said.
“Notwithstanding an apparent hiccup in the road to recovery, we believe that medium- to long-term business prospects are still intact. Our products generally serve basic industries. From our past experience, after every crisis, when recovery starts, we usually start seeing good growth in the businesses we are in,” Lao said.
All business units, including food ingredients, bio-diesel, specialty products and consumer products posted double-digit increase in net income contribution.
Aside from recovery in overall business, the lower income taxes due to the Corporate Recovery and Tax Incentives for Enterprises Act also boosted the company’s bottomline in the first quarter by P32 million.
Exports rose 84 percent year-on-year and contributing 34 percent to total revenues in the first quarter.
Lao said coconut-based products under food and oleochemicals were the main drivers behind the robust export growth. Coconut oil continued to gain traction in the global market because of perceived natural antiviral, antibacterial and antifungal properties.
Coconut-based products are great sustainable substitutes for petroleum-based raw materials used in many applications such as personal hygiene and home cleaning products.
The company sees continued strong coconut oil-based exports, which should offset some of the weakness in the domestic market in the near term.
The company is on track with the completion of its P4.5-billion expansion facility in Batangas province. The facility will cater to D&L’s growing export businesses in the food and oleochemicals segments.
The Batangas expansion will be instrumental to its future growth as it plans to develop more high value-added coconut-based products and penetrate new markets.