Specialty food ingredients and oleochemicals producer D&L Industries Inc. expects to surpass last year’s P2.3 billion profit this 2024,  optimistic that its usually strong fourth-quarter performance will contribute to a robust overall year.
 
D&L Industries president and Chief Executive Officer Alvin Lao said there still seems to be a lot of consumer activities in the fourth quarter despite higher prices.  
 
“Fourth quarter should be better, especially for the food segment because it’s the ‘ber’ months (Christmas season)… So we should see 2024 better than last year,” he said.
 
In a disclosure to the local bourse Wednesday, D&L Industries reported its net income reached P1.8 billion in the first nine months of the year.
 
For the third quarter alone, the company booked P493 million in profit, down 11 percent compared to the same period last year, which was largely due to higher cost base resulting from newly commissioned lines inside the Batangas plant.
 
Lao said the firm needs to earn P520 million in the last quarter to at least match last year’s profit.
 
“Strong export sales continue to drive overall business amidst the generally cautious consumer sentiment in the domestic market. So far this year, export is outpacing domestic performance. Export sales are up 38 percent YoY (year-on-year) with gross profits up 24 percent YoY,” he said.
 
“We expect exports to continue to increase its relevance to the overall business. From this perspective, our Batangas plant becomes more strategic as it allows us to go after exports more aggressively. We believe the near-term cost drag coming from the new plant masks its long-term potential. What we are witnessing is the very early stages of a long-term structural growth story of the company," Lao added.
 
Exports continued positive momentum well into the first nine months of the year, booking a total sales of P9.2 billion, which is higher by 38 percent YoY.
 
Lao said they may hit their target of exports accounting for 50 percent of revenues in five years, although this is not definite since the domestic market is also expected to grow further on the back of easing inflation.
 
The company booked double-digit volume growth in both its high margin specialty products (HMSP) and commodity segments. HMSP volumes were up 18 percent YoY while commodity volumes were up 44 percent YoY in the first nine months of the year.
 
HMSP volumes rose by 10 percent in the third quarter, up for the fifth consecutive quarter since the commercial operations of its Batangas plant.